WORCESTER— Real estate lawyer Alan Mason has been temporarily suspended from practicing law for bouncing checks and misusing clients’ money in a Leominster property transaction.
Associate Supreme Judicial Court Justice Francis X. Spina issued a decision Monday banning Mr. Mason from practicing law at least until another complaint against him before the SJC is resolved. Justice Spina ruled that Mr. Mason posed a threat to current or future clients.
“The instant case may well be the tip of the iceberg,” his decision said.
Mr. Mason, of Princeton, has a Shrewsbury Street office with a large residential real-estate law practice. A Worcester property manager knowledgeable in the local industry said Mr. Mason also is a major player in transactions involving financially distressed properties.
The state bar counsel filed a complaint with the state’s highest court Dec. 28 alleging that Mr. Mason failed to pay off a $427,500 mortgage on a new home in Leominster that was being bought by his clients, Mark and Joanne Smith. Instead of paying off the mortgage, Mr. Mason allegedly used part of the sales proceeds to satisfy other business or client obligations.
In July 2003, Bar Counsel Daniel C. Crane filed another complaint, alleging that Mr. Mason shielded his assets from his creditors after filing for bankruptcy in February 1995, used real estate trusts to conceal his assets and orchestrated a phony real estate transaction to avoid paying liens on a property in Oxford. Hearings on that case were concluded before the Board of Bar Overseers last March, but a decision has yet to be made.
In the Smith transaction, Mr. Mason was the settlement agent for the Smiths’ lender, Salem Five Mortgage Co., and acted as the title insurance agent for Stewart Title Guaranty Co., according to a complaint filed by Susan Strauss Weisberg, assistant bar counsel.
At the Oct. 5 closing, Mr. Mason received $255,245.59 from the buyers, as well as the proceeds of a $300,000 mortgage from Salem Five. He was responsible for paying off the seller’s construction mortgage of $427,500, which was owed to Fitchburg Savings Bank.
The money that was supposed to be used to pay off the mortgage was deposited into a business account of Mr. Mason’s and used for other purposes, according to the complaint. By Oct. 21, the complaint said, the account had a balance of $145.96.
The complaint provided the following chronology:
On Oct. 17, Fitchburg Savings received an unsigned check dated Oct. 5 from Mr. Mason for the $427,500 payoff, and returned it to him. On or about Oct. 19 Mr. Mason re-sent the payoff check, now bearing his signature, back to the bank, though the balance of the account on that date was $1,819.96.
The check, written on an account at Webster First Federal Credit Union, was returned for insufficient funds on Oct. 24.
Mr. Mason, however, had already submitted a “replacement” check to Fitchburg Savings on Oct. 21. The replacement check, also for $427,500, was drawn on an account at Bank of America in the name of Lunar Title Co., of which Mr. Mason was a manager. The replacement check also bounced.
Beginning in late October, Douglas Burwick, the lawyer for the seller, made repeated inquiries about the payment of the mortgage. On Nov. 1, Mr. Mason told him that he had obtained a cashier’s check for the $427,500, but that one of his employees had lost it.
On Nov. 4, Mr. Mason delivered a check for $260,000, which cleared, leaving an unpaid balance of $167,500, not including interest. Mr. Mason, however, did not pay the balance, and Stewart Title paid $171,641.91 to Fitchburg Savings on Nov. 23 to satisfy the mortgage.
The complaint was filed, and Mr. Mason was asked to provide documentation for the transaction, but he did not.
Three calls to Mr. Mason’s business yesterday for comment were not answered.
According to Justice Spina’s decision, Mr. Mason blamed his financial difficulties on his tax problems. The state Department of Revenue has listed Mr. Mason as the state’s third biggest tax deadbeat and claims he owes $1.8 million in unpaid taxes.
Mr. Mason told the court he is disputing that figure.
Mr. Mason also owes $1 million in personal income taxes to the Internal Revenue Service, according to documents filed at the Worcester Registry of Deeds. The state tax problems are causing a “domino effect” on Mr. Mason’s business, he told Justice Spina.
In 2003, Mr. Mason said Hasan M. Hussain was the source of the complaint to the Board of Bar Overseers. Mr. Mason said Mr. Hussain solicited negative comments from Mr. Mason’s present and former clients and provided the information to the bar counsel.
Posted by: SOT
Most lawyers that end up disbarred because of trust administration failures
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