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In re McKenzie

Supreme Court of New Jersey

July 20, 2018


          Argued: April 19, 2018

          District Docket No. XIV-2017-0246E

          Ellen A. Brotfsky Chief Counsel


          Bruce W. Clark, Vice-Chair

         Hillary K. Horton appeared on behalf of the Office of Attorney Ethics. Jonathan D. Clemente appeared on behalf of respondent. To the Honorable Chief Justice and Associate Justices of the Supreme Court of New Jersey.

         This matter was before us on a motion for final discipline filed by the Office of Attorney Ethics (OAE)f pursuant to R. 1:20-13(c), following respondent's entry of an "Alford Plea" in the United States Virgin Islands to one count of compounding a crime, in violation of 14 Virgin Islands Code (VIC) S52l(a)(3).[1]

         Although we determine to grant the OAE's motion, we are unable to reach a consensus on the proper quantum of discipline. Three members vote for a six-month prospective suspension. The remaining three members vote for a one-year prospective suspension.

         Respondent was admitted to the New Jersey and New York bars in 1983, and to the South Carolina bar in 1994. He has no prior discipline or pending matters. He has been in retired status since 2008.

         Respondent's counsel, Jonathan D. Clemente, Esq. filed a March 5, 2018 brief with us containing a jurisdictional snapshot of the within matter, as follows:

[Respondent's] case was brought in the Virgin Islands Superior Court, which is the trial court of general jurisdiction in the territory, and is distinct from the District Court of the United States Virgin Islands (DVT), a federal court which is part of the Third Circuit. Prosecutions brought by the Attorney General in the Superior Court are initiated by the filing of an Information; there is no right to indictment by grand jury in the Territory of the Virgin islands.

         According to a September 1, 2016 amended Information, the Virgin Islands Office of the Lieutenant Governor (OLG) is responsible for the attachment and sale of real estate for nonpayment of real estate taxes. That function is conducted by the Tax Collector's Office of the Division of Real Property within the OLG.

         From July 1, 2012 to September 30, 2013, Calford Charleswell was the Chief Enforcement Officer of the tax division within the OLG. His duties included serving notices of attachment, auctioning real property for delinquent taxes, and issuing titles to properties sold at auction. The procedures for auctions are established by statute, rules, and regulations, but Charleswell and others made certain changes that enabled him and a group of individuals to manipulate the bidding process. Specifically, they devised a scheme whereby the highest bidder purposefully made a substantially inflated high bid, then failed to post the required ten percent deposit, so that another bidder or individual would acquire the property for a substantially lower price.

         A group of individuals including respondent, Charleswell, Paul Sabers, and Sylvester Warner, in concert with each other, were alleged to have manipulated the bidding process, thereby engaging in numerous criminal acts, including forgery; obtaining money by false pretenses; conversion of government property; conspiracy; recording false documents; making fraudulent claims on the government; larceny; and embezzlement. The alleged purpose of the enterprise was to circumvent the previously established auction process, in order to enrich or facilitate the enrichment of certain individuals.

         At respondent's March 17, 2017 plea and sentencing hearing in the Superior Court of the Virgin Islands, Division of St. Thomas and St. John (SCVI), Assistant Attorney General John Tolud moved to amend the amended information against respondent, to add one count of compounding a crime, a violation of 14 VIC §521(a) (3), titled Punishment for Compounding Crime:

(a) Whoever, having knowledge of the actual commission of a crime, takes money or property of another or any gratuity or reward, or an engagement or promise therefor, upon any agreement or understanding, express or implied, to compound or conceal such crime, or a violation of this title or other law, or to abstain from, discontinue, or delay, a prosecution therefor, or to withhold any evidence thereof, except in a case provided for by law in which the crime may be compromised by leave of court, shall be imprisoned not more than -
(1) five years, where the agreement or undertaking relates to a crime punishable by life imprisonment; or
(2) three years, where the agreement or understanding relates to any other felony; or
(3) ninety days or fined not more than $100, or both, where the agreement or understanding relates to a misdemeanor.

         Here, under subsection (3), the agreement or understanding related to a misdemeanor, carrying a maximum ninety-day term of imprisonment and $100 fine. The Office of the Attorney General and respondent agreed to seek a ninety-day term of incarceration, with all time suspended, and credit for any time served, one year of probation, and 100 hours of community service.

         In exchange for respondent's guilty plea, the Office of the Attorney General agreed to dismiss the four remaining charges against respondent: (1) conspiracy; (2) obtaining money by false pretense; (3) conversion of government property; and (4) one count of Criminally Influenced Corrupt Organizations (CICO) conspiracy.

         During the plea phase of respondent's hearing before the Honorable Michael C. Dunston, PJSCVT, Assistant Attorney General Tolud recited the factual basis for respondent's plea. Had the matter gone to trial, the government would have proven that, on August 30, 2012, respondent was listed as bidder number one at a government real property auction conducted by the OLG. Respondent was listed as number one on the "1, 2, 3 sheet with the [bid] amount of $75, 000." Although respondent was the winning bidder, he did not make the required ten percent deposit within the time designated to do so, ultimately affording a co-defendant, Paul Sabers, the opportunity to purchase the property for $10, 000. Respondent provided the funds to another co-defendant, Sylvester Warner, to pay the OLG for the purchase. The government further would have proven that, as a result of his acts, respondent knowingly concealed the crime of obtaining property under false pretenses, concerning the co-defendant's purchase of the property, in collaboration with three co-defendants, thereby defrauding the People of the Virgin Islands and the true owner of the property.

         Although respondent pleaded guilty to the compounding crime, he was unwilling to admit that he participated in the acts that constituted the offense. His attorney, Treston E. Moore, Esq. placed the following on the record:

[M]y client is pleading guilty but pursuant to the provisions of North Carolina vs Alford at 400 U.S. 25, 1970, and that a plea of guilty is based upon the ability of the Government to state more significant charges against him, that by going to trial he would face more significant charges. The particular counts, I believe, are 5, 10, 10, and 80, are the more severe charges for the RICO - the CICO statute which we challenged at pretrial, which Your Honor upheld the ability of the Government to go forward on that particular count as well.
In a discussion with my client and we've agreed, I'm allowed to waive just this portion of attorney/client. I went over those charges with him. I recommended that this was a better deal and a better opportunity, and he's pleading guilty not because he believes he's guilty, but he's doing it pursuant to Alford. ...

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