The $4.1 million that has Bay Harbor Islands ex-town attorney under FBI investigation
Craig Sherman, Bay Harbor Islands town attorney for 43 years, is being investigated by the FBI. He’s also being sued by a man who had been a client for 30 years. Sherman also recently gave up his law license.
All over $4.175 million that former client Barry Smith’s lawsuit says Smith gave Sherman for investments, most of it in Bay Harbor Islands’ real estate projects.
The lawsuit says Sherman never invested any of Smith’s money and admitted to Smith he “screwed” him.
Sherman resigned as Bay Harbor Islands town attorney in November. Bay Harbor turned the matter over to the Florida Department of Law Enforcement in December. FDLE said after an initial review, it learned Boca Raton police were investigating Sherman (Sherman & Sherman’s offices are in Boca Raton).
Boca Raton police told the Miami Herald that the Sherman matter has been turned over to the FBI.
Meanwhile, the state Supreme Court accepted Sherman’s application for disciplinary revocation of his license in the face of a Florida Bar investigation. Disciplinary revocation is an option often taken by attorneys in a deep discipline quagmire. It allows the attorney to give up the license in exchange for the professional discipline part of the matter going away.
That still leaves the legal matters, both civil (Smith’s suit) and potentially criminal (the FBI investigation). The suit quotes Sherman’s disciplinary revocation application, which says Sherman “makes no admissions herein, but would agree there is a factual predicate for disciplinary action.”
Money for nothing?
According to the lawsuit, Sherman told Smith to invest in “development rights” by loaning money to developers doing projects in Bay Harbor Islands, a small town along the Broad Causeway. The return: 10% yearly with the principal on the loans repaid when the projects were done.
From June 16, 2016, through March 27, 2019, Smith made 17 wire transfers totaling $4,575,000 to Sherman & Sherman’s trust account. In early 2019, Smith received interest payments on the loans. But, the lawsuit says, they came from Sherman & Sherman’s trust account, not the developers Smith thought were his debtors.
Smith’s lawsuit says Sherman told Smith a moratorium by the city stalled two of the projects, and, therefore, the payments. But the city told Smith there was no moratorium.
Confronted with that on Oct. 23, 2019, the lawsuit says, Sherman admitted he “screwed” Smith and used the money for himself. Unwilling to let a 30-year relationship die over some money, Smith said he and Sherman would be good if Sherman just paid back the remaining $4.175 million.
Sherman said he didn’t have it, but offered to pay back $10,000 a month. Smith rejected that idea — that would take about 34 years, eight months. Sherman is 77 years old.
This story was originally published May 14, 2020 at 7:43 AM.
