A former Cobb County attorney has been indicted by a federal grand jury on charges she stole more than $300,000 she received from a local government to place in escrow for payment to a Georgia business.
Carla B. Gaines, 60, of Mableton, was indicted Dec. 10 on charges of wire fraud and theft from a local government that receives federal funding, the U.S. Attorney’s Office for the Northern District of Georgia said.
According to prosecutors, Gaines was a licensed attorney in the state until she was disbarred on Nov. 18. Between August 2014 and March 2016, she allegedly stole $337,400 given to her by the Clayton County government.
The county in 2014 entered into an agreement with Kelete for that company to sell an easement or right-of-way through its property to the government for $712,400. Gaines was brought on as an escrow agent for the transaction, and Clayton County transferred $712,400 to her to hold in an escrow account and complete the transaction.
The real estate deal closed in November 2015, and Gaines paid $375,000 to Kelete and the company’s bank. As part of the settlement, Gaines had to hold $337,400 in escrow until Kelete removed improvements on the property. It completed that task in March 2016, and requested payment of the remaining money.
However, federal prosecutors say Gaines never paid the money and used the funds to pay for personal and her law firm’s expenses.
“After the theft, Gaines allegedly lied to Clayton County and Kelete to convince them that she still had the money and payment was on the way,” the U.S. Attorney’s office said, adding Gaines claimed the wire transfer was pending, that it was “stuck,” and the bank was “holding the wire.”
Federal prosecutors say these claims were not true. Kelete sued Gaines to recover the money it was owed. The attorney testified at two depositions where she said she paid a portion of the funds owed to Kelete to another client “in error.” She informed that client of the mistake and he promised to repay the money back to her. Prosecutors also say this was false.
“Attorneys who allegedly lie and steal abuse the trust owed to their clients and violate the law,” said U.S. Attorney BJay Pak. “The indictment alleges that Gaines stole client money that should have been held in escrow, and then lied about the theft in an attempt to lull her victims into a false sense of security.”
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