A Mableton woman has been disbarred as an attorney and arraigned in federal court after authorities claim she stole over $300,000 from the Clayton County government and a College Park company then lied about it under oath.
Carla Burton Gaines, 60, was disbarred on Nov. 18 in a unanimous Supreme Court of Georgia ruling, court documents show, stating Gaines violated a variety of professional conduct rules in relation to her alleged theft and subsequent lies.
She was indicted by a federal grand jury on Dec. 10 on charges of wire fraud and theft, according to U.S. Attorney Byung Pak.
Gaines is the owner and principal attorney of The Law Firm of Gaines and Associates, an Atlanta based firm claiming to have recovered over $128,000 for clients and won almost 1,000 cases, according to the company’s website.
Aside from Gaines, only two team members are listed on the firm’s website; a paralegal and a communications manager.
Gaines was admitted to the state bar in 1991, court records show.
Per federal court documents:
In 2014, Clayton County entered into an agreement with College Park-based company Kelete to sell a right of way or easement through Kelete’s property to the county for $712,400.
Gaines was retained to serve as the escrow agent for this real estate transaction, and accordingly Clayton County transferred $712,400 to Gaines for her to hold.
In November 2015, Clayton County and Kelete closed the real estate deal and Gaines paid $375,000 to Kelete at the time of closing, per the agreement.
Under the settlement, Gaines was required to hold the remaining $337,400 in escrow until Kelete removed certain trade fixtures and improvements on the property.
In March 2016, Kelete completed the removal and requested the remaining payment of $337,400, but Gaines never paid, despite repeated demands.
Instead of holding the $337,400 in escrow as required, Gaines had diverted the funds to pay for personal and law firm expenses.
“Attorneys who allegedly lie and steal abuse the trust owed to their clients and violate the law,” U.S. Attorney Pak said. “The indictment alleges that Gaines stole client money that should have been held in escrow, and then lied about the theft in an attempt to lull her victims into a false sense of security.”
Pak said Gaines repeatedly lied to Clayton County and Kelete, telling them the money had been wired and was on its way, even blaming the bank for holding it up.
“These representations were false,” Pak said. “No wires were stuck, pending, held, or on their way; and no check was ready. Gaines had far less than $337,400 in her bank accounts at the time she made these misrepresentations.”
Kelete sued Gaines and her law firm to recover the money it was owed.
As part of the civil proceeding, Gaines lied while testifying in court depositions in 2017 and 2018, federal agents allege.
“Gaines testified that she had paid a portion of Kelete’s funds to another client, a pastor, in error,” a news release from the U.S. Department of Justice states. “Gaines also testified that she had called the pastor and informed him of the mistake, and that he had promised repeatedly to pay the money back to Gaines. These representations were false.”
Gaines’ disbarment states Kelete obtained a default judgement in the case in the amount of $336,400 plus legal costs.
Georgia Supreme Court justices said Gaines had a prior disciplinary offense, relating to a case in 2014, and that she ultimately had a dishonest or selfish motive, committed multiple offenses, engaged in bad-faith obstruction of disciplinary proceedings, and had exhibited indifference to making restitution.
“It is very disheartening when a lawyer, sworn to uphold the Constitution of the United States and the constitution of the jurisdiction they are licensed in, violates that oath,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “When they do, the FBI is committed to protecting the citizens who suffer from their transgression.”