What happened to a Florida attorney accused of misappropriating $1 million
As the sole trustee of a trust account, a Sarasota County lawyer violated that trust by paying himself more than $1.06 million too much in trustee fees, the Florida Bar alleged.
The case referee and the state Supreme Court agreed, which is why William Schlotthauer was disbarred Thursday by the court.
Though the report by case referee Judge John McGowan stated Schlotthauer didn’t answer the Bar’s official inquiry or show up at any of the case hearings, Schlotthauer filed a motion for rehearing after he was disbarred. He claims he and the Bar agreed to an extension allowing him to file an objection to the referee’s report and that extension ran until Monday.
Schlotthauer had been a member of the bar since 2000.
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A money matter of a trust
What follows comes from testimony before McGowan.
Schlotthauer, 51, the referee’s report stated, was the only trustee of trusts on behalf of Louis Marinaccio Jr. and Ann Marie Marinaccio.
Affidavits from them and Louis Marinaccio III claimed there was a spoken agreement with Schlotthauer that his trustee fees would be no more than 0.25% of the trust’s assets per year. This would run from 2014 through November 2021.
In 2020, the Bar put forth, the two trusts had approximately $28 million in assets. At 0.25% — not 25%, but 0.25% — that comes out to approximately $70,000 in trustee fees per year.
In 2019, the Bar auditor found, Schlotthauer moved $284,922 from the Marinaccios’ trust accounts to his personal and business accounts. The following year, with his trustee fees coming to $68,544, he moved $280,689 from the trust accounts to his accounts.
The Marinaccios told Schlotthauer in November 2021 that he’d need to show the work in the form of a detailed invoice if he wanted any more trustee fees. Also, only with approval from one of the Marinaccios could those trustee fees go over $1,000 per month.
As that conversation took place in November, the Bar auditor’s opinion was “[Schlotthauer] would have been eligible to receive 0.25% of the assets of the trust for 2021. Based on the same $28,000,000.00 valuation, (he) would have been entitled to approximately $70,000.00 in trustee fees for 2021.”
Schlotthauer’s net transfers from the Marinaccios’ accounts to his accounts in 2021: $539,665.
Schlotthauer transferred $120,075 in 2022, but Louis Marinaccio III said the lawyer didn’t come up with any invoices or billing for hours worked as a trustee.
“lt is the auditor’s opinion that respondent was not entitled to any trustee fees for the year 2023,” the referee’s report said. “Between 2019 and 2023, (Schlotthauer) transferred a net of at least $1,261,072.00 from accounts belonging to the trusts to his personal and business accounts.”
By the auditor’s math, Schlotthauer was entitled to $199,573 in trustee fees for 2019, 2020 and 2021. That’s $1,061,499 less than he transferred to his accounts.
