Aaron Rodney Nicholls took ~$700,000 of a client's trust account funds
Misappropriating about $700,000 of a client’s trust account funds has gotten Auckland-based ex-lawyer Aaron Rodney Nicholls struck off the roll of barristers and solicitors by the New Zealand Lawyers and Conveyancers Disciplinary Tribunal, reported the NZ Law Society.
The tribunal determined that strike-off was the sole appropriate outcome given the amount involved and Nicholls’ multiple violations of fiduciary duties. The former lawyer, who was a sole practitioner under his firm Nicholls Law Ltd., has been suspended on an interim basis since 17 April.
The standards committee began investigating Nicholls’ trust account operations in February after a client who held money in his account claimed that Nicholls did not handle the funds as directed. The investigation revealed that Nicholls started making unauthorised withdrawals exceeding $700,000 from the funds in November 2017 and that he had hidden these transactions by falsifying statements until February this year.
Nine claims have been received by the Fidelity Fund thus far. Six of these claims, which come to $400,000, have been paid out; the remaining three claims are valued at $224,000.
Nicholls’ penalty hearing took place on 25 November. While the ex-lawyer was at the proceedings, he provided no explanation as to what the funds had been used on; thus, the tribunal inferred that he had benefitted from the money himself.
Moreover, while Nicholls displayed sorrow for how his conduct had inconvenienced others, the tribunal said that such a response was not convincing given he did not provide useful information about the defalcation. The tribunal added that Nicholls had tried to distance himself from his actions, as per the filed affidavit.
The tribunal concluded that given Nicholls’ record of unsatisfactory conduct (five findings) and how he failed to engage with Law Society processes, he was to be struck off. The tribunal also ordered him to shoulder expenses.
