On Wednesday, February 15, 2023, the Supreme Court of the State of New York Appellate Division, Second Judicial Department suspended attorney David Fuster II for failure to safeguard funds entrusted to him.

The case is entitled “In the matter of David Fuster II”, and was brought by the Grievance Committee for the second, eleventh, and thirteenth judicial district with case no. 2020-03885.

The charges cited New York Rules of Professional Conduct 1.15(a) and 5.3 which state:

Failure to safeguard funds entrusted to him as a fiduciary incident to his practice of law.

Failed to adequately supervise the work of two nonlawyer employees of his law firm.

The Rules of Professional Conduct can be found here.

Allegedly, in two charges of professional misconduct, the respondent violated the rules of professional conduct. The first one was when the respondent was required to safeguard a total of $296, 800.83 on behalf of six clients, but failed to do so. The second one was when the respondent failed to adequately manage his two non-lawyer employees when he let them handle the said escrow accounts.

The filing states:

“Orrly and Mariam Sampedro, $1,610; Santos and Ex pectacion Z a mora, $78,000; Dianne Kavanoug h, $180,471; Victor M. Amay a Orellano, $1,000; Vicente Pallchisaca, $1,000; and Gloria Salas, $ 3 4 , 7 1 9 . 8 3. On November 26, 2014, the balance in the escrow account was $79.29. B between August 2013 and November 2014, client funds totaling approximately $467,079 were improperly transferred out of the escrow account by the respondent’s employees.”

The filing continues:

“The respondent failed to review the bank statements and records for the escrow account. The respondent relied on summary reports of the escrow account activity prepared by Rojas and Sanghavi. The respondent, thus, failed to notice that between August 2013 and November 2014, Rojas and Sanghavi transferred client funds totaling approximately $467,079 from the escrow account to their own bank accounts.”

In the report of the referee, it emphasized that although the respondent stated that he was victimized by the two employees who abused his trust, he nevertheless failed to detect the fraudulent conduct that occurred for over 15 months. Moreover, the referee mentioned that even after the respondent was already alerted about the irregularity, he did not inquire further about the integrity of the escrow account. The court believes that the factual allegations given by the referee against the respondent warrant suspension.

The Disposition states:

“ORDERED that the respondent, A. David Fuster II is suspended from the practice of law for a period of three years, commencing March 17, 2023, and continuing until further order of this Court. The respondent shall not apply for reinstatement earlier than September 17, 2025.”

Mr. Fuster II attended the New York University School of Law, graduating in 1997. He practices in Jamaica Queens, New York. He is licensed in New York. Mr. Fuster’s info can be found on martindale.com.

A copy of the original filing can be found here.