Criminal Justice

Former LeClairRyan general counsel pleads guilty to obstructing probe of financial misconduct

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The former general counsel for the defunct law firm LeClairRyan has pleaded guilty to obstructing an official proceeding for trying to thwart an investigation into his misconduct as a bankruptcy trustee.

Disbarred lawyer Bruce Matson, 64, made false statements to the Department of Justice’s U.S. Trustee Program in 2019 when he was asked about misappropriating funds as the liquidation trustee in the bankruptcy of the LandAmerica Financial Group, according to a press release announcing the guilty plea Thursday.

Law360, Bloomberg Law and the Richmond Times-Dispatch have coverage; the plea agreement’s statement of facts is here.

Prosecutors said Matson embezzled $800,000 from the LandAmerica Financial Group trust between 2015 and 2018. He also allegedly manipulated the wind-down after the bankruptcy to divert more than $3.2 million in residual funds to himself and others. To access the funds, Matson inserted language into the budget the night before it was filed with the bankruptcy court that appeared to give him authority to use the funds for discretionary bonuses.

Matson said in an affidavit in his disbarment that $2.8 million in wind-down money, including $1.5 million paid to another lawyer as a bonus, had been returned to the trust account. The statement of facts in Matson’s criminal case said he also received $350,000 in wind-down money paid to LeClairRyan under an agreement with his firm.

Prosecutors alleged that the federal investigation uncovered a separate instance in which Matson allegedly embezzled $23,000 in 2016 in his role as a receiver for the estate of a defunct futures broker.

U.S. District Judge John A. Gibney Jr. of the Eastern District of Virginia said during the plea hearing Thursday the misconduct alleged in the statement of facts shows “a long history of malfeasance,” according to the Richmond Times-Dispatch. Gibney warned Matson that “it is very, very likely in this case that you will go to jail for a while.”

Matson is scheduled to be sentenced Nov. 22. He faces a maximum of five years in prison.

LeClairRyan’s partners voted to dissolve the firm in August 2019. Matson practiced law at the firm’s Richmond, Virginia, office.

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