In re Jeffrey Gunderson, 2025PR00051 was decided by the Hearing Board. This is a case where the lawyer made serious accounting and bookkeeping errors in maintaining his trust account, but was able to save his law license because no clients were harmed and because the lawyer introduced substantial mitigating evidence of good conduct. The Hearing Board recommended a two year suspension. This is a case where good defense work contributed to saving the law license.

Procedural History

• August 28, 2025 — Administrator filed a 21-count complaint against respondent.
• October 31, 2025 — Respondent filed an answer, admitting many factual allegations but denying the misconduct charges.
• Pre-hearing — The chair granted the Administrator’s oral motion to (1) strike allegations regarding wire transfers after January 2023 from paragraph 133, (2) amend the January 2023 wire transfer date to January 13, 2023, and (3) amend charging paragraph 147(a) regarding the characterization of the Real View account transfer.
• May 28–29, 2026 — Hearing held before a panel consisting of Rhonda Sallée (chair), Cristin K.M. Duffy, and Michael Silver. Evette L. Ocasio and Richard C. Gleason, II represented the Administrator; James A. Doppke represented respondent.
• Evidence presented: Two fact witnesses plus respondent (as an adverse witness) for the Administrator; respondent testified on his own behalf and called three character witnesses. Administrator’s Exhibits 1–8 and 12–29 admitted; respondent offered no exhibits.
• September 11, 2026 — Report and Recommendation filed and certified by Michelle M. Thome, Clerk of the ARDC.

Charges

• Counts I–XIX: Knowing, dishonest conversion of client/third-party funds (Rules 1.15(a) and 8.4(c)) — one investment-fund matter ($175,000) and eighteen real estate earnest-money transactions.
• Count XX: Commingling client/third-party funds with personal funds (Rules 1.15(a)/1.15(b)).
• Count XXI: Failure to maintain required trust account records (Rules 1.15(a)/1.15A(b)).

Key Findings

• The Hearing Board found all charges proven by clear and convincing evidence.
• Count I: Respondent received $175,000 in investor funds via his “Real View” account (never an actual IOLTA account) and used most of it for personal/business expenses (credit card debt, loan payments, an unrelated settlement) before eventually repaying it in two installments. The Board rejected as not credible his claim that the client’s principal had authorized him to keep ~$100,000 as fees/investment proceeds.
• Counts II–XIX: A recurring pattern across numerous real estate closings — respondent deposited earnest money into non-trust accounts (personal, operating, or “Real View”) that were then depleted below required holding amounts before closing, often to cover unrelated personal or business expenses, with funds replenished from other clients’ incoming earnest money.
• Count XX: Extensive commingling documented via bank records (e.g., $380,500 in wires and $137,371.34 in checks representing client funds deposited into his personal account; $422,609 in checks into his operating account; $99,099.97 of personal funds deposited into his IOLTA account).
• Count XXI: Respondent admitted he failed to keep contemporaneous client ledgers and required three-way reconciliations from January 2022 to November 2023.
• The Board found respondent not credible and not candid regarding his claimed authorization to use the $175,000 and his explanation for repaying it in two installments — treated as an aggravating factor.

Mitigation and Aggravation

Mitigation: No prior discipline in 20 years; disorganization following departure of a law partner and paralegal; substantial pro bono work (~30% of practice), community/volunteer involvement; no client complaints or actual financial harm; three character witnesses attesting to honesty (though two expressed reservations about the allegations). This was excellent work by defense counsel.

Aggravation: Nearly two years of sustained misconduct that continued even after the ARDC was notified of an IOLTA overdraft; lack of candor before the Board.

Citing In re Elias as the closest comparator, the Board recommended a two-year suspension, with completion of the ARDC Professionalism Seminar required before reinstatement. The Board rejected the Administrator’s request for a three-year suspension and rejected respondent’s request for a shorter, probation-eligible term, reasoning that probation “suggests a problem that can be fixed,” whereas respondent had already closed his trust account and no longer holds client funds — making probation superfluous rather than corrective.

In my opinion the penalty is too harsh given that there was no client harm.