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April 13, 2017 at 10:57 AM
The federal prosecution of a former Sutherland Asbill & Brennan partner for allegedly stealing millions of dollars from a longtime Sutherland client will be delayed—at least temporarily—while a judge considers whether the 76-year-old attorney is incompetent to stand trial due to dementia.
U.S. Magistrate Judge Linda Walker on Friday stayed the criminal prosecution of Bennett Kight and in a teleconference on Tuesday directed federal prosecutors and Kight’s defense counsel to select a physician who will examine Kight and prepare a report on his mental capacity.
— (Related on ThinkAdvisor: If Advisors Get Dementia, What Happens to Their Clients?)
According to Kight’s defense team, a physician with whom Kight consulted last year said that an MRI of his brain revealed a “black hole”—caused by the apparent death of brain cells—in an area of the brain that affects judgment, memory, motivation, and personality. Over the objection of prosecutors, Walker granted a motion to seal the underlying medical records.
The federal indictment, handed down by a grand jury in Atlanta last year, accuses Kight of multiple counts of mail fraud stemming from allegations that he stole more than $2 million from a longtime client of the law firm, now known as Eversheds Sutherland, by orchestrating sham real estate transactions that siphoning funds from the client’s family trusts
The indictment accuses Kight of diverting funds in trust to pay a $500,000 mortgage on his Buckhead home and using another $1.5 million for personal investments.
While the indictment identifies Kight’s now former client only by the initials F.B., ongoing civil fraud suits in Fulton County’s State and Superior Courts naming Kight as a defendant claim that for years the lawyer plundered at least $60 million from trusts he oversaw for Frances Bunzl, the 97-year-old widow and heir of industrialist and philanthropist Walter Bunzl. When Walter Bunzl died in 1988, he was worth more than $130 million, according to the Fulton County cases. Court documents say the Sutherland firm first began representing Walter Bunzl and his companies in the 1940s after Bunzl and family members fled Austria Prior to World War II.
Kight’s lawyers requested a stay and a competency hearing last month. Dentons attorneys Barry Armstrong and Rachel Cannon contend that after suffering a brain hemorrhage in January 2008, Kight’s mental capacity “declined progressively” and that he was diagnosed with dementia in December. For at least four years after the 2008 brain bleed, Kight continued to manage the Bunzl trusts, according to Fulton County court records.
