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Madison attorney faces 3-year license suspension

By: Erika Strebel, [email protected]//June 30, 2016//

Madison attorney faces 3-year license suspension

By: Erika Strebel, [email protected]//June 30, 2016//

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A Madison attorney faces a three-year suspension of his license over allegations that he mishandled more than $700,000 that should have been held in trust for clients and other parties.

According to a 30-page complaint filed June 24 by the Office of Lawyer Regulation, the attorney Michael Bauer committed 28 counts of misconduct involving several clients while he was working at Bauer & Bach in Madison.

Bauer, reached Thursday, declined to comment.

The law firm, formed in 2010 by Bauer and Daniel Bach, who now works in the Madison and Jefferson offices of Lawton & Cates, specialized in civil and criminal litigation, often representing property owners in eminent-domain cases. The firm dissolved in August 2015, according to records from the Wisconsin Department of Financial Institutions.

The OLR’s allegations in part concerned work Bauer had done in an eminent-domain case for Village Mobil Inc., a car-repair shop in Waunakee. Bauer was accused of misappropriating more than $27,000 of the money Village Mobil had placed in the firm’s trust account.

Before $357,000 of Village Mobil’s money was deposited into the firm’s trust account, the account’s balance was $2,320.17. Of that, $1,705.36 belonged to two clients with whom Bauer had dealings concerning real-estate investments.

Following Village Mobil’s deposit, the OLR alleges, Bauer wired $29,317.30 from the trust account to the two clients, even though most of the money in the account did not belong to them. Later, he transferred that same amount back into the trust account from an account set up for Sports Advisors Inc., a company that he owns and that provides various services to professional football players. The transfers were never recorded in the trust-account ledger, according to the OLR.

Bauer’s violations also concern a $265,000 eminent-domain settlement reached for his client FNB Properties LLC. After the settlement was deposited into the law firm’s trust account, Bauer withdrew $70,000 to cover the law firm’s fees and then went on to use eight transfers to move $195,000 worth of the settlement money into the firm’s business account.

According to the complaint, Bauer later directed Old Ivy Capital partners to wire $200,000 to the trust account. To conceal his misappropriation of FNB’s money, he did not record the transfer, according to the OLR’s complaint.

The complaint details four other client matters, three of which concerned eminent-domain cases and one a worker’s compensation case.

In some instances, according to the OLR, Bauer would take money from the trust account and move it to the firm’s business account without recording the transfer in the official ledger. The transfers, though, would be noted in a business-account ledger, being described as a reimbursement to a client with the last name White. The firm had no clients with that last name. Bauer would then transfer the money to the Sports Advisor account.

The OLR alleges that the reimbursements to White were in fact a placeholder for him to keep track of expenses related to real-estate investments.

The OLR also alleges that Bauer would have financing companies wire money into the trust account to restore the account’s balance and then would either fail to record the transfers or would record transfers to the trust account that had actually never happened.

The OLR also alleges that Bauer made 52 prohibited online transfers from September 2013 to May 2014 — moving $892,000 in total from the law firm’s trust account. Generally, lawyers in Wisconsin cannot make online transfers to and from their trust accounts, although a recent rule change will allow them to do so soon.

The OLR is asking the Wisconsin Supreme Court to suspend Bauer’s license for three years. He has 20 days from receiving the complaint to respond.

Bauer, who now practices at Bauer Law LLC, earned his law degree from the University of Wisconsin Law School and has been licensed to practice law in Wisconsin since 1998. His license is active and in good standing, and the Supreme Court has not previously disciplined him, according to the OLR and State Bar of Wisconsin websites.

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