In 2005, attorney Sean M. Liles gave up his Nevada bar license. In exchange, Liles avoid discipline proceedings from the State Bar of Nevada. Officials alleged that Liles took part in a scheme to commit insurance fraud by submitting false claims relating to construction lawsuits.
Now, Liles is facing fresh ethics charges. These charges come from the State Bar of Michigan. Officials allege that Liles misused his client trust fund account. They say that he used his client trust fund account to pay his personal home mortgage. Allegedly, Liles transferred funds from his personal account to his IOLTA client trust fund account and then used the funds to pay the mortgage on his home. In Michigan, attorneys must hold client funds in a separate IOLTA account that’s completely separate from their personal accounts. The attorney may remove the money only when it’s earned in attorney fees, spent on court costs or returned to the client.
When Liles submitted his resignation to the State Bar of Nevada, he was already in West Bloomfield, Michigan. From there, he set up a practice in Traverse City, Michigan where he focuses on family law, criminal and bankruptcy matters. The Michigan Attorney Grievance Commission filed the formal complaint against Liles on July 11, 2017. Officials say they first learned of the discrepancies when the bank tipped them off to the unusual transfers.
In his reply to the State Bar of Michigan’s inquiry, Liles claimed that the mortgage payments from the IOLTA account were a mistake. He said, “I did not realize I had accidentally input the Chase IOLTA Account instead of my personal account,” and “I have since corrected the problem.” Liles also tried to excuse the error by saying that “I was/am an idiot with mobile ap[p]s.)” Liles didn’t offer a motive for his behavior.
The Michigan Attorney Grievance Commission isn’t buying it. They say it’s implausible that Liles transferred funds accidentally for several months. Officials say that his conduct involves dishonesty and deceit, and that lawyers have to keep client funds completely separate from personal money. They also say that Liles misrepresented the facts when they asked him to explain his behavior.
There’s no word on what discipline the State Bar of Michigan hopes to pursue in Liles’ case. While the grievance asks for discipline that’s “warranted,” this could range from an informal reprimand to a complete disbarment. Officials may reach a consent agreement with Liles, or they may take the case to a hearing where a commission determines a penalty.