Lawyer suspended for pocketing fees intended for law firm; court warns of tougher future penalties

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A Cedar Rapids, Iowa, lawyer has been suspended for four months for keeping fees from clients that should have been split with his law firm.

The Iowa Supreme Court indefinitely suspended Curtis Den Beste, without the possibility of reinstatement for four months, in a Sept. 13 opinion.

The Des Moines Register and the Gazette have coverage, while the Legal Profession Blog posted highlights from the decision.

Den Beste collected $18,200 in fees that he failed to split with the Howes Law Firm, the opinion said. The law firm should have received $9,200 of the total, after taking into account tax and reimbursement considerations, according to the opinion. Den Beste was not criminally charged, and he agreed to a repayment plan.

The Iowa Supreme Court said a four-month suspension is in accord with prior cases. In those cases, theft from a client ordinarily leads to revocation of a lawyer’s law license, but theft from an employer can result in a sanction that is much lower.

The court used the cases, however, to put the bar on notice that it would “ratchet up the disciplinary sanctions for nonclient theft” in future cases.

Den Beste received his law license in 2000 and began practicing law at the Howes Law Firm in 2007. His agreement with the law firm required him to deposit all earned client fees into a trust account or the general law firm account, the opinion said. Den Beste would then retain half of the fees he earned, and the law firm would keep the other half for overhead and other expenses.

Beginning in 2015, however, Den Beste accepted cash payments from some clients and kept the proceeds for himself, the opinion said. The misconduct was discovered in March 2017, when he told the firm’s accounting manager to “write off” several accounts because they were deemed to be “uncollectable.”

When the manager began calling clients to collect payment, some said they had paid Den Beste directly. When he was confronted by lawyer Steve Howes, Den Beste admitted to the theft and was fired. He self-reported the misconduct to disciplinary authorities.

Howes submitted a letter to the disciplinary board that said he was the only person harmed by the theft. He also spoke positively about Den Beste’s professional abilities and character and his mentorship of young lawyers.

The Iowa Supreme Court said the theft is conduct that involves dishonesty, fraud, deceit or misrepresentation. The conduct also reflects adversely on Den Beste’s “fitness to practice law,” the court said.

Although a four-month suspension fits with prior case law, the Iowa Supreme Court said, acting dishonestly toward an employer “raises serious questions of whether the lawyer has the necessary integrity to practice law.”

“We use this case as a vehicle to put the bar on notice that an attorney who steals from a law firm without a colorable claim may well incur stiffer disciplinary sanctions than have been imposed in our past cases,” the court said.

Chief Justice Mark Cady wrote the majority opinion. In a partial dissent, Justice David Wiggins said Den Beste’s law license should have been revoked, which would allow him to reapply for his law license in five years.

“Theft of funds involves dishonesty, and dishonest attorneys have no place in our profession,” Wiggins wrote.

A phone number listed for Den Beste on the Iowa Judicial Branch website notifies callers in a recording that the number is busy.

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