State Bar suspends license of Salisbury attorney
SALISBURY — The North Carolina State Bar reported this week it has suspended the law license of Salisbury attorney William “Trippe” McKeny for three years.
The Disciplinary Hearing Commission of the State Bar found Nov. 21 that McKeny mishandled trust funds “and engaged in gross trust account mismanagement,” according to Carmen H. Bannon, who represented the State Bar at the hearing.
After serving one year of the active suspension, McKeny may apply for a stay of the remaining two years, if he shows compliance with several conditions.
The hearing panel was comprised of Sharon B. Alexander, chairman; Irvin W. Hankins III; and Patti Head. Dudley A. Witt served as McKeny’s attorney.
McKeny became a member of the N.C. State Bar in March 2003 and has practiced in Salisbury at 116 N. Main St. and more recently at 115 E. Council St.
There was an unusual mitigating factor in the panel’s decision to suspend McKeny.
The hearing’s findings noted that during the period for which McKeny is being censured, he was suffering from an undiagnosed post-traumatic stress disorder (PTSD).
“As a result of his untreated PTSD symptoms, McKeny was highly anxious, reactive and depressed,” the consent order of discipline states.
“The symptoms of this disorder significantly impaired McKeny’s professional judgment and were a major contributing factor to his mismanagement of client funds.”
The consent order continues that McKeny adapted by allocating his limited energy and attention to representing his clients in court rather than managing his law practice.
McKeny was formally diagnosed with PTSD early this year and has been receiving treatment from Dr. Beth Arrigo since the diagnosis.
“Nonetheless, McKeny’s symptoms continue to affect his professional judgment and functioning and additional therapeutic intervention is warranted,” the consent order says.
Because of the PTSD, the hearing found, “there is insufficient evidence to show he acted with intent or dishonest motive when he engaged” in the misconduct.
“Thus, under the unique circumstances of this case, McKeny’s misuse of client funds did not constitute criminal conduct reflecting adversely on his fitness as a lawyer or conduct involving dishonesty,” the order states.
The different forms of discipline considered by the panel included admonition, reprimand, censure, suspension and disbarment.
McKeny must submit his license and membership card to the secretary of the N.C. Bar no later than Dec. 20.
McKeny can apply for a stay of his suspension after a year by meeting numerous conditions, including distributing all client funds in his possession back to his clients within 60 days — and providing proof to the Bar of those disbursements.
McKeny also will have to complete two hours of continuing legal education in trust account management and continue under the treatment of Arrigo.
Within two months of filing for reinstatement of his license, McKeny will have to be evaluated at his own expense by a psychiatrist approved by the State Bar.
If he receives a stay of his suspension, the order says, a certified public accountant must audit his new trust account, and the CPA must provide quarterly reports to the State Bar showing McKeny to be in compliance with the Rules of Professional Conduct.
The panel concluded McKeny had shown remorse for his misconduct, had been cooperative, provided full and free disclosure and had made good-faith efforts to make restitution.
But it also found McKeny had elevated his own interests above that of a client, intended to commit acts where the harm was foreseeable, misappropriated and converted assets to which he was not entitled and demonstrated “a pattern of misconduct and multiple offenses.”
The panel said McKeny failed to maintain the following records for his trust account:
• Documentation of the source of all deposits and the client on whose behalf the deposit was received.
• Copies of all checks drawn on the account, showing the client balance against which it was withdrawn.
• Records of electronic withdrawal and/or transfers showing the recipient of the disbursement and the client balance against which it was drawn.
• A general ledger of receipts and disbursements identifying the client on whose behalf each receipt and disbursement was made.
• Complete, accurate individual client ledgers showing receipts, disbursements and the current balance of funds held in trust for each client.
The hearing revealed McKeny frequently deposited client payments designated for attorney fees and court costs into his operating account, not his trust account.
He wrote trust account checks payable to cash on several occasions.
Credit card payments by clients to McKeny also proved to be a problem. He used Sterling Payment Technologies to process credit card payments, and Sterling collected its fees by direct debit from McKeny’s trust account twice a month.
“The credit card processing fees charged by Sterling were a business expense incurred for McKeny’s benefit and convenience, not an expense incurred for the benefit of a client,” the consent order states.
“McKeny only intermittently deposited personal funds into the trust account to offset the debits to Sterling. From 2009 to 2011, the Sterling fees debited from the trust account exceeded the personal funds deposited by McKeny to cover those debits by more than $5,000.”
The clients never authorized McKeny to use their entrusted funds for Sterling’s services.
In addition, McKeny represented Sherrie Monnell in a personal injury case, which was settled for $7,000.
McKeny deposited the settlement’s proceeds into his trust account on Dec. 17, 2009.
The consent order found McKeny would use funds from his operating account, including money he was supposed to be holding in trust for Monnell, to pay for his personal and business expenses.
He did so without Monnell’s authorization.
Contact Mark Wineka at 704-797-4263.