BEFORE THE HEARING BOARD OF THE ILLINOIS ATTORNEY REGISTRATION AND DISCLIPLINARY COMMISSION In the Matter of: VINCENT LEO PALMIERI, Attorney-Respondent, Commission No. 2016 PR 00042 Chairperson Patrick M. Blanchard No. 2138700. ATTORNEY-RESPONDENT VINCENT LEO PALMIERFS ANSWER TO THE COMPLAINT AND RULE 231 DISCLOSURE For his Answer to the Complaint and Rule 231 Disclosures, Attorney-Respondent Vincent Leo Palmieri ("Mr. Palmieri"), by and through his attorneys, Figliulo & Silverman, P.C., states as follows: ANSWER COUNT I (Failure to SafeKeep Property in Pamell Closing) 1. On or before July 23, 2013, Respondent and Nicholas and Kelly Calace ("the Calaces"), who were friends with one another, agreed that Respondent would represent the Calaces in the sale of their residential property at 3809 South Parnell Avenue in Chicago for no fee. 2. On or about July 23, 2013, the Calaces contracted to sell the South Parnell property to Jiazhaio and Zhaoquan Chen ("the Chens") for the purchase price of $458,000. The contract provided that the Chens were allowed early possession of the South Parnell property on August 1, 2013 and that the closing on the property was to occur on October 28, 2013. Attorney Wallace K. Moy ("Moy") represented the Chens in this transaction. FILED JUN %0 20)6 ATTVRECGHffiCC0MM
3. The July 23, 2013, contract of sale for the South Parnell property also included a separate possession escrow agreement via a rider ("the Rider"). The terms of the Rider stated that the "Earnest Money deposit shall be in the amount of $45,800, representing ten percent of the Purchase Price" and that "[i]n the event that Closing does not take place on or before October 28, 2013, through no fault of Seller, then the full amount of the Earnest Money shall be paid to Sellers as Liquidated Damages. Otherwise, the Earnest Money shall be applied to the Purchase Price at the time of closing. If Closing does not take place on or before October 28, 2013, then Buyer shall immediately vacate possession of the Property. If Buyer does not vacate or close by October 31st, Buyer, in addition to the Earnest Money shall pay seller as additional damages, the sum of $100 per day for each day that Buyer remains in possession after October 31st. In addition Buyer shall pay all costs or damages associated with or connected to Buyer's remaining in possession after October 31st." 4. The Rider further stated: "Vincent L. Palmieri, as Escrowee, is authorized to pay the sum of $3,000 per month to Seller from the earnest money deposited with him. Seller may use such sum for any reason. Notwithstanding the withdrawal from the Earnest Money, at closing the full amount of Earnest Money deposited shall still be credited towards the purchase price with no reduction for amounts paid to Seller." 5. The Rider also stated that Respondent would hold the $45,800 in earnest money in his client trust account, entitled "Client Funds Account of Seller's Attorney, Vincent L. Palmieri, 27820 Irma Lee Circle, Lake Forest, Illinois," until the closing on the South Parnell property. Admitted 6. On or about July 29, 2013, the Chens delivered a check to Respondent in the amount of $45,800, which represented the escrow funds pursuant to the possession escrow agreement described in paragraph three, above. On August 2, 2013, Respondent, or someone at Respondent's direction, deposited the check in the amount of $45,800 into his client trust account ending in 6553 held at PNC Bank. The account was entitled, "Vincent L. Palmieri, Attorney at Law, Atty Trust Acct" ("client trust account").
7. Respondent received these funds in connection with his representation of the Calaces. 8. On August 30, 2013, Respondent, or someone at Respondent's direction, drew check number 1003 in the amount of $43,500 on his client trust account. Check number 1003 was made payable to Adesso Investments, LLC ("Adesso"), an investment management company where Respondent is managing director. On that same day, Respondent, or someone at Respondent's direction, deposited check number 1003 into Adesso's account at Libertyville Bank and Trust ending in 0198, entitled "Adesso Investments LLC." 9. As of August 30, 2013, pursuant to the escrow agreement described in paragraph four, above, the Calaces were only entitled to one $3,000 pay-out from the $45,800 earnest money. No other disbursements were allowed by the escrow agreement or authorized by the Chens or their attorney. At no time did the Calaces receive any disbursement of $3,000 pursuant to the agreement. Further answering, the earnest money was disbursed for the benefit ofthe Calaces. 10. On August 30, 2013, Respondent drew the balance in his client trust account to $2,300. 11. Between August 2, 2013 and October 10, 2013, Respondent used at least $43,500 ofthe earnest money for his own business or personal purposes. Denied. 12. At no time did the Chens or their attorney authorize Respondent to use any portion of the earnest money for Respondent's own business or personal use.
13. By using a portion of the earnest money without authority, Respondent engaged in conversion of client and/or third party funds received by Respondent in connection with his representation ofthe Calaces. Denied. 14. At the time Respondent engaged in conversion ofthe earnest money, he knew that he was using the funds for his own purposes, or a third party's purposes, without authority. Denied. 15. On September 25, 2013, Moy sent a letter to Respondent providing evidence of building code violations on the South Parnell property and directing Respondent not to make any further disbursement ofthe earnest money to the Sellers. Respondent received that letter shortly thereafter. Mr. Palmieri denies that the letter sent by Moy on September 25, 2013, provided evidence of building code violations on the South Parnell property, but admits the remaining allegations contained in Paragraph 15. 16. On October 9, 2013, Moy sent a letter to Respondent, on behalf of the Chens, stating that Moy had received notice that the South Parnell property was in foreclosure and demanding an accounting of the $45,800 of earnest money. Respondent received the October 9, 2013 letter shortly thereafter. the Chens. 17. At no time did Respondent provide an accounting of the earnest money to Moy or
18. By reason of the conduct described above, Respondent has engaged in the following misconduct: a. failure to hold property of clients or third persons that is in a lawyer's possession in connection with a representation separate from the lawyer's own property, by conduct including Respondent's failure to hold the $45,800 of escrow funds in his client trust account; and converting funds belonging to the Chens, and/or third persons, for his own use and causing the balance in his client trust account to fall below the amount then belonging to clients or third persons, in violation of Rule 1.15(a) of the Illinois Rules of Professional Conduct (2010); and, b. conduct involving dishonesty, fraud, deceit or misrepresentation, by conduct including converting funds belonging to the Chens and/or third persons and Respondents failure to account for the funds on or after October 9, 2013, in violation of Rule 8.4(c) of the Illinois Rules of Professional Conduct (2010). Mr. Palmieri admits that he should not have disbursed the earnest money as he did and that he did not comply with Rule 1.15(a). Mr. Palmieri denies that he converted any funds and denies that he used the earnest money for his own benefit. COUNT II (Misrepresentation in the Parnell Closing) 19. In or around October 2013, Respondent withdrew from representing the Calaces. The Calaces soon after retained attorney Steven Rappin ("Rappin") to represent them concerning the building code violations and the sale of the South Parnell property. Respondent, however, continued to be the designated escrow funds holder, as described in paragraph five, above. The scheduled closing on the property at 3809 South Parnell, as referenced in paragraph two, above, did not occur on October 28, 2013. Mr. Palmieri denies that Rappin was retained to represent the Calaces concerning the building code violations, but admits the remaining allegations contained in Paragraph 19.
20. On or about December 18, 2013, Respondent sent a letter to Rappin providing an accounting of the $45,800 in earnest money given to Respondent by the Chens, as referenced in paragraph six, above. In that letter, Respondent stated, "I am currently holding $45,800 in my client funds account for this transaction." Mr. Palmieri admits that he sent a letter to Steve Rappin dated December 18, 2013, which stated "I am currently holding $45,800 in my client funds account for this transaction." Mr. Palmieri denies the remaining allegations contained in Paragraph 20. 21. On or about January 31, 2014, Respondent sent another letter to Rappin purportedly providing a further accounting ofthe $45,800 in earnest money given to Respondent by the Chens, as referenced in paragraph six, above. In that letter, Respondent stated, "The Escrow account held by my office currently has $45,800 available in it." Mr. Palmieri admits that he sent another letter to Steve Rappin dated January 31, 2014, which stated "The Escrow account held by my office currently has $45,800 available in it." Mr. Palmieri denies the remaining allegations contained in Paragraph 21. 22. Respondent's statements in paragraphs 20 and 21, above, were false because Respondent was only holding $2,300 in his client trust account at the time both statements were made. 23. At the time Respondent made the statements referred to in paragraphs 20 and 21, above, Respondent knew his statements were false. 24. By reason of the conduct described above, Respondent has engaged in the following misconduct:
a. conduct involving dishonesty, fraud, deceit or misrepresentation, by conduct including Respondent falsely stating to Rappin that Respondent was holding $45,800 in his client fund account for the 3809 South Parnell closing, in violation of Rule 8.4(c) of the Illinois Rules of Professional Conduct (2010). Mr. Palmieri admits that his letters contained false statements, which he understands violates Rule 8.4(c). RULE 231 DISCLOSURE (a) State whether Respondent has ever been admitted to practice law before any other state court, federal court or administrative agency or admitted before the bar of any foreign country and, if so, state the identify of each such court, jurisdiction or agency; the year of such admission, the full name under which respondent was admitted and any subsequent name changes; and any bar or registration number assigned. Mr. Palmieri was admitted to practice law before the United States Tax Court on November 13, 1979 under the name Vincent Leo Palmieri. (b) State whether Respondent has ever received any other professional license or certificate and, ifso, the identity ofeach such issuing entity; the year ofissuance ofeach such license or certificate; the full name under which the license or certificate was issued to Respondent and any subsequent name changes; and any certificate or registration number assigned. Mr. Palmieri received a Certified Public Accountant certificate on February 21, 1979. The certificate was issued by the University of Illinois Board of Trustees, and the certificate number is 24196. Date: June 20, 2016 Respectfully submitted, Vincent Leo Palmieri, By:
Peter A. Silverman (ARDC# 6196081) Lisa M. Mazzone (ARDC# 6303922) Figliulo & Silverman, P.C. 10 S. LaSalleSt, Ste. 3600 Chicago, Illinois 60603 (312)251-4600 psilverman@fslegal.com lmazzone@fslegal.com
CERTIFICATE OF SERVICE The undersigned attorney states that she caused a copy of the attached: ATTORNEY-RESPONDENT VINCENT LEO PALMIERI'S ANSWER TO THE COMPLAINT AND RULE 231 DISCLOSURE to be served upon counsel listed below via e-mail and by depositing a copy ofsame in the U.S. Mailat 10 S. LaSalle St., Chicago, IL 60603 on June 20, 2016 before the hour of 5:00 p.m., proper postage prepaid. Counsel: Tara Korthals One Prudential Plaza 130 E. Randolph Dr., Ste. 1500 Chicago, Illinois 60601 (312)565-2600 tkorthals@iardc.org