White-Collar Crime

Texas Lawyer Pleads Guilty to Misusing $600K of Children's Personal Injury Awards

A Texas lawyer appointed to represent children in personal injury cases pleaded guilty Friday to using their legal awards for personal use, rather than directly placing the funds in court registries.

The registries are meant to hold the children’s money until they reach the age of 18, the Austin American-Statesman reported, and in some cases John William Coates did deposit the money by the time a client reached adulthood. In other instances it didn’t get there in time.

The Austin man pleaded guilty to felony aggravated misapplication of fiduciary property, and agreed to a 10-year prison deal. According to the Statesman, Coates returned $600,000 he had withheld from clients before the deal was reached.

Coates, who was booked into the county jail, could be released on probation after six months if he agrees to certain conditions, like relinquishing his law license, Travis County assistant district attorney Gail Van Winkle told the Statesman. The paper reported that Coates has been under administrative suspension with the State Bar of Texas since 2010, because he hasn’t paid the agency’s dues or occupation tax.

The district attorney’s office learned of Coates’ actions two years ago, when a client reported their money was missing, Van Winkle said. Law enforcement then saw from bank records that Coates had been using client funds for personal use since 2002.

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