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Utah attorney sent to jail for spending client's settlement

Published May 12, 2012 9:02 pm

Court • He will serve 60 days; he spent most of client's $412,500.
This is an archived article that was published on sltrib.com in 2012, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

A Utah attorney who spent hundreds of thousands of dollars that a client won in a personal-injury lawsuit has been sentenced to 60 days in jail.

Steven B. Smith, 51, was sentenced Friday in 3rd District Court after pleading guilty earlier this year to third-degree felony charges of communications fraud and forgery.

According to court documents, Smith spent most of a $412,500 settlement his client won against an insurance company in January 2008. Smith allegedly told his client he was still trying to settle the matter and placed the check in his own bank account. Smith "wrote numerous large checks" totaling $405,500.

In January 2010, the client confronted Smith after discovering the truth about the settlement, the charges state. Smith initially denied there had been a settlement but later admitted to spending the client's share, an amount in excess of $200,000.

In a letter to the court, Smith's wife offered support for her husband but said he "needs some very strong counseling" and asked for jail time.

"His training as an attorney, along with his size, and defiant behavior can be very intimidating. ... Most people back down very easily," she wrote. "He has fooled every counselor we have been to. I know he is hurting very badly inside. ... Any changes he makes is not going to happen in our home. Therefore, I plead with the court to incarcerate him, and help him receiving counseling at the level that he will not be able to intimidate or fool."

In addition to jail time, Judge Elizabeth Hruby-Mills ordered Smith to complete a 36-month probation. Restitution will be determined at a later date.

Smith was disbarred in January for taking the client's money and failing to diligently handle another client's case, court records show.

Smith's attorney could not immediately be reached for comment Friday.

afalk@sltrib.com