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ATTORNEY disciplinary
proceeding. Attorney's license
suspended.
¶1 PER CURIAM. We review, pursuant to
SCR 22.17(2), the report of the referee,
Richard C. Ninneman, recommending the court
suspend Attorney Walter W. Stern, III's
license to practice law for a period of two
years for professional misconduct resulting
in his federal criminal conviction for
conspiring to commit money laundering in
violation of 18 U.S.C. § 1956(h). No appeal
has been filed.
¶2 We approve and adopt the referee's
findings of fact and conclusions of law. We
conclude that the seriousness of Attorney
Stern's misconduct warrants a two-year
license suspension. The Office of Lawyer
Regulation (OLR) does not seek costs. No
costs will be imposed.
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¶3 Attorney Stern has been licensed to
practice law in Wisconsin since 1974. He
has been subject to a number of previous
disciplinary proceedings. In August of
1988, the Board of Attorneys Professional
Responsibility (BAPR), the predecessor to
the OLR, imposed a private reprimand on
Attorney Stern for professional misconduct
consisting of communicating on the subject
of the representation with a party he knew
to be represented by a lawyer without the
consent of the lawyer. In September of
1992, BAPR publicly reprimanded Attorney
Stern for professional misconduct consisting
of advancing a factual position without a
basis; failing to maintain the respect due
courts of justice and judicial officers;
violating the Attorney's Oath; and engaging
in offensive personality. Public Reprimand
of Walter W. Stern III, No. 1992-11. In
November of 1993, Attorney Stern consented
to a private reprimand for professional
misconduct consisting of failing to pay a
third-party lien from settlement proceeds
after receiving notice of the lien. BAPR
Private Reprimand, No. 1993 25. In March of
2008, Attorney Stern consented to a private
reprimand for professional misconduct
consisting of committing criminal acts that
reflected adversely on his honesty,
trustworthiness, or fitness as a lawyer.
The discipline was a result of Attorney
Stern pleading no contest to a second and
third offense of Operating a Motor Vehicle
While Under the Influence. OLR Private
Reprimand, No. 2008-08.
¶4 The disciplinary complaint now
before us involves allegations that Attorney
Stern engaged in money laundering in
connection with funds received by a party,
N.L.A., pursuant to a marital settlement
agreement (MSA). On or about June 1, 2005,
N.L.A. and her then-husband entered into an
MSA under which N.L.A. was to receive
$95,000. On or about June 22, 2005,
N.L.A.'s divorce attorney deposited $29,000
toward the MSA in a trust account.
¶5 Attorney Stern was acquainted with
N.L.A. and referred her to a bankruptcy
attorney. On or about September 30, 2005,
N.L.A. filed a Chapter 7 bankruptcy
petition. N.L.A. concealed the MSA and the
funds received and due under the MSA from
her bankruptcy attorney.
¶6 In October of 2005, N.L.A.'s divorce
attorney received a second MSA payment of
$20,000.
¶7 On or about January 14, 2006, the
bankruptcy court determined N.L.A.'s
petition to be a no-asset case and
discharged her debts.
¶8 On or about January 17, 2006,
N.L.A.'s divorce attorney received a third
MSA payment of $20,000.
¶9 On or about March 3, 2006, N.L.A.
gave the funds from the three MSA payments
to Attorney Stern. Attorney Stern then
purchased a certificate of deposit (CD) from
a bank in his own name, with the proceeds
going to N.L.A. upon his death.
¶10 In April of 2006, N.L.A. received a
fourth MSA payment of $26,000.
¶11 In January of 2007, Attorney Stern
used the proceeds from the March 2006 CD and
the fourth MSA payment to purchase another
CD, also in his name, payable to N.L.A. upon
his death.
¶12 On December 20, 2011, a federal
grand jury indicted Attorney Stern for
violating 18 U.S.C. § 1956(h) by knowingly
conspiring with N.L.A. to commit money
laundering to conceal the $95,000 N.L.A.
received, thereby committing bankruptcy
fraud.
¶13 On June 20, 2012, a federal jury
found Attorney Stern guilty of the money
laundering charge. On January 9, 2013,
Attorney Stern was sentenced to federal
prison for one year and one day.
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¶14 On January 22, 2013, the OLR filed a
complaint alleging that by engaging in
conduct resulting in his federal criminal
conviction for conspiring to commit money
laundering in violation of 18 U.S.C. § 1956
(h), Attorney Stern committed a criminal act
that reflected adversely on his honesty,
trustworthiness, or fitness as a lawyer in
other respects, contrary to SCR 20:8.4(b)
and engaged in conduct involving dishonesty,
fraud, deceit, or misrepresentation,
contrary to SCR 20:8.4(c).
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¶15 On February 4, 2013, the parties
filed a stipulation and no contest plea
agreement whereby Attorney Stern pled no
contest to the misconduct alleged in the
complaint. Attorney Stern agreed that the
referee could use the allegations of the
complaint as an adequate factual basis for a
determination of misconduct and for the
discipline requested. Attorney Stern
further agreed that it would be appropriate
for this court to impose the level of
discipline sought by the OLR Director,
namely, a two-year suspension of Attorney
Stern's license to practice law in
Wisconsin. The parties requested that the
referee approve the stipulation and file a
report finding facts and misconduct
consistent with the stipulation and
recommending that Attorney Stern's license
to practice law be suspended for two years.
¶16 On February 20, 2013, the referee
filed his findings of fact, conclusions of
law, and recommendation in which he adopted
the parties' stipulated findings of fact;
found that the OLR had proven by clear,
satisfactory, and convincing evidence that
Attorney Stern violated SCRs 20:8.4(b) and
(c); and recommended that Attorney Stern's
license to practice law be suspended for two
years. No appeal was filed from the
referee's report and recommendation.
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¶17 This court will affirm a referee's
findings of fact unless they are clearly
erroneous, but conclusions of law are
reviewed de novo. See In re
Disciplinary
Proceedings Against Eisenberg, 2004 WI 14,
¶5, 269 Wis. 2d 43, 675 N.W.2d 747. This
court is free to impose whatever discipline
it deems appropriate, regardless of the
referee's recommendation. See In re
Disciplinary Proceedings Against Widule,
2003 WI 34, ¶44, 261 Wis. 2d 45, 660 N.W.2d
686.
¶18 We adopt the referee's findings of
fact and conclusions of law and determine
that a two-year suspension is the
appropriate discipline for Attorney Stern's
professional misconduct. The actions that
led to Attorney Stern's federal conviction
of conspiring to commit money laundering are
serious failings that warrant a significant
level of discipline.
¶19 As to costs, the OLR states that
Attorney Stern's prompt entry into a
comprehensive stipulation avoided
expenditure of any significant amount of
lawyer regulation system resources.
Consistent with the OLR's recommendation, no
costs will be imposed.
¶20 IT IS ORDERED that the license of
Walter W. Stern, III, to practice law in
Wisconsin is suspended for a period of two
years, effective the date of this order.
¶21 IT IS FURTHER ORDERED that Walter W.
Stern, III, shall comply with the provisions
of SCR 22.26 concerning the duties of an
attorney whose license to practice law has
been suspended.
¶22 IT IS FURTHER ORDERED that
compliance with all conditions of this order
is required for reinstatement. See SCR
22.29
(4)(c).
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