Lawyer Peter Leach admits to spending clients' settlement money

PROVIDENCE – A personal injury lawyer suspended in 2019 amid complaints that he spent his clients' money on golf club membership fees, airline flights, hotels and other personal expenses intends to plead guilty to wire fraud and tax evasion charges.

Federal authorities this week charged Peter P.D. Leach with one count each of wire fraud and attempted tax evasion for pilfering settlement money that was intended to go to clients.

Court documents indicate that Leach, a solo personal injury practitioner who worked out of Providence offices, intends to plead guilty to the charges. Leach faces up to 25 years in prison and $250,000 in fines.

He is set to be arraigned Friday.

More on this case:Court suspends Providence lawyer over alleged misuse of client money

Authorities allege that Leach agreed to terms in which he was to receive 33% of any settlement amount he negotiated on clients’ behalf and pay them the remainder, minus any expenses. Instead, they say he used the money for personal expenses such as tuition to Wheeler School, Syracuse University and Pitzer College, as well as membership fees to Metacomet Country Club, travel expenses, and to pay for restaurant bills.

All the while, prosecutors say he misled clients by providing false accountings with respect to the money and lulling them with false excuses on the status of their legal cases.

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Over the years, prosecutors say, he misappropriated more than $500,000 of his clients’ settlement funds, causing $250,000-plus in losses to clients who were never paid some or all of the funds to which they were entitled.

They accuse him of forging his clients’ signatures on the back of settlement checks and then depositing those checks into his business accounts without notifying his clients that he had received the settlement checks.

He used the funds he obtained from his clients’ to repay earlier clients whose funds he had previously misappropriated, and to pay for personal expenses out of his business accounts, prosecutors said.

In addition, they say, he falsely represented to his clients that he used a portion of the settlement funds to pay medical and other expenses associated with their injuries when, in fact, he failed to pay those expenses.

Rhode Island Supreme Court rules required Leach, and all lawyers, to hold client money separate from his own; notify clients of any settlement checks received; and promptly deliver the settlement funds to the clients.

According to federal prosecutors, though, from November 2014 through March 2019, Leach failed to properly maintain, account for, and use money meant for the clients.

In addition, they charge that he failed to pay his federal income taxes between 2014 and 2018 until tax officials contacted him. Leach then paid some of the unpaid taxes, but authorities were forced to place a lien on his property, serve a Notice of Levy to his bank, and attempted to initiate payment plans.

Prosecutors allege, too, that he attempted to prevent the IRS from collecting his unpaid liabilities for the tax years 2013 to 2017 by using his business accounts to pay personal expenses, ceasing the use of his personal bank accounts, and using bank accounts of family members. Plus, they say he submitted false tax documents in which he failed to disclose assets, and withdrew large sums of money from his business accounts in cash. In total, they accuse Leach of evading more than $300,000 in taxes.

The state Supreme Court in 2019 agreed to immediately suspend Leach from practicing law and to appoint the court's chief disciplinary counsel David D. Curtin as special master based on bank records that indicate a "persistent pattern" of Leach misappropriating client money for his own use, according to findings by Curtin.

According to the disciplinary petition recommending Leach's immediate suspension, Alexis Jackson filed a complaint in December 2018, alleging that Leach had delayed paying her settlement funds from a personal injury case stemming from a car crash in 2013. Jackson complained that she could not cash the settlement check she received due to insufficient funds.

Curtin subpoenaed Leach's bank records and found that Leach had deposited Jackson's $400,000 settlement check in December 2016, two years before he paid Jackson. Curtin said his review found that Leach had misappropriated Jackson's money and ultimately paid the $226,443 she was due from a family trust fund.

Another family also raised similar complaints about Leach misspending their settlement.