Former Lawrence Attorney Arraigned for Stealing More Than $900,000 From Clients
Defendant Allegedly Stole Money for His Personal Use; Stole from Elderly Client
SALEM – A now-disbarred Lawrence attorney has been arraigned in connection with stealing more than $900,000 from multiple clients, one of them elderly, Attorney General Martha Coakley announced today.
Phillip Thompson, age 35, of Lawrence, was arraigned today in Essex Superior Court on charges of Larceny over $250 from a Person over Sixty, Larceny over $250 (7 counts) and Unauthorized Practice of Law.
At the arraignment, Thompson pleaded not guilty to the charges and was released on personal recognizance, subject to bail conditions set in a related case pending in Middlesex Superior Court.
In that case, he was released on $10,000 bail and Middlesex Superior Court Judge Kathe Tuttman ordered him to remain on house arrest and be monitored by a GPS device, with the conditions that he is permitted to leave for employment Monday through Friday and for Sunday religious services. Judge Tuttman also ordered that he surrender his passport and be prohibited from practicing law.
The Commonwealth alleges that today’s charges are related to the open case in Middlesex in that they are all part of a continuing scheme by Thompson, while an attorney, to defraud his clients. The Middlesex charges from 2011 also involve larceny and embezzlement and are being handled by the Middlesex District Attorney’s Office. At today’s arraignment, Judge Timothy Feeley allowed a motion to transfer the Essex County indictments to Middlesex Superior Court.
The AG’s Office began an investigation in 2011 after the matter was referred by the Essex County District Attorney’s Office. Thompson worked as an attorney out of his Lawrence law office, primarily specializing in real estate, and also ran a debt collection agency out of his office. Authorities allege that between July 2007 and June 2011, Thompson stole more than $900,000 from at least seven clients.
The investigation revealed that Thompson represented clients in several real estate transactions, allegedly failing to pay off loans and failing to give funds to clients who were owed money.
In one case, Thompson allegedly represented an elderly man and his wife who were seeking to obtain a settlement from their insurance company after their home burned down. When the insurance company issued more than $416,000 in checks jointly to the clients and Thompson, Thompson allegedly converted the funds for his own use and the clients never received any of the money.
In another instance, a reverend gave Thompson $60,000 to hold in escrow pending a closing on land that his church intended to purchase. When the closing fell through, Thompson allegedly never returned the money and kept it for his personal use.
According to investigators, Thompson continued to solicit legal business and represent himself as an attorney after he was suspended from practice in June 2010. Thompson was later disbarred in July 2012.
A Statewide Grand Jury returned indictments against Thompson on June 13. He was arraigned today in Essex Superior Court. He is due back in Middlesex Superior Court on July 30 for a status hearing.
These charges are allegations, and the defendant is presumed innocent until proven guilty.
The case is being prosecuted by Assistant Attorney General Margret Cooke, of AG Coakley’s Fraud and Financial Crimes Division, with assistance from Investigators Kevin Floster and Stephen Bethoney of AG Coakley’s Financial Investigations Division, members of the Massachusetts State Police assigned to the AG’s Office, and Victim Witness Advocates Ashley Cinelli and Megan Murphy of the AG’s Victim Services Division.