Former Foley & Lardner partner is suspended for falsifying documents
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A former partner at Foley & Lardner has been suspended for two years for misleading the IRS with falsified documents.
The Wisconsin Supreme Court suspended former trusts and estates partner Adam Wiensch in an Oct. 16 opinion, report the American Lawyer, the Legal Profession Blog and the Milwaukee Journal Sentinel.
Foley & Lardner informed the IRS in August 2016 that Wiensch was no longer with the firm, and it believed that some of the documents may have been falsified. The firm also reported Wiensch to legal ethics regulators. He was a Milwaukee-based partner and had been listed as one of the top lawyers for wealthy individuals in 2009 by Worth magazine.
Wiensch “was an experienced attorney who should have known better,” the Wisconsin Supreme Court said in the opinion. “The deceptions and misrepresentations, both to the IRS and the other attorneys at attorney Wiensch’s firm, continued for several years.”
Wiensch had provided some of the altered documents to the IRS in 2012. He said they memorialized the transfer of more than $50 million in stock from the business owned by his husband-and-wife clients to a trust in exchange for a promissory note. Their children were the trustees and the beneficiaries.
The purpose of the sale was to transfer wealth to the children free of estate and gift taxes and to ensure that future appreciation of the stock held in trust would not be part of the estate, the opinion said.
The IRS reviews such transactions to determine whether the transaction should be treated as a taxable gift or whether the transferred assets should be included in the seller’s estate when determining estate taxes owed, the opinion explained.
Wiensch maintained the documents were created at the time of the stock transfer, but that wasn’t true, the opinion said. He misdated and added a clause to an installment sale agreement. He also misdated another document and pasted onto it copies of the children’s signatures.
He supplied the IRS with additional falsified documents for power of attorney in 2015 in connection with the wife’s transfer of some stock shares to the children. A suspicious IRS auditor sought to interview the children in July 2016; their parents were no longer living. The IRS later settled litigation related to the estates.
The clients aren’t identified by the Wisconsin Supreme Court, but the facts of the case suggest they were the owners of Carma Laboratories, the makers of Carmex, according to the Milwaukee Journal Sentinel.
Foley & Lardner issued a statement on the case. “We have zero tolerance for actions that violate our core values and the trust our clients place in us,” the statement said. “Upon becoming aware of irregularities, the firm promptly launched an internal review. It was determined that conduct occurred which needed to be reported to the appropriate authorities and the firm cooperated with them.”
Wiensch has no prior disciplinary history and acknowledged ethics violations. He told ethics regulators he was facing “several highly disruptive and challenging personal issues” at the time, including depression and alcohol dependence. He stopped drinking and has been attending Alcoholics Anonymous meetings since March 2017. He is also focused on dealing with his depression.
