Attorney Grievance Commission v. McLaughlin

BATTAGLIA, Judge. The respondent, Thomas J. McLaughlin (hereinafter “McLaughlin” or “respondent”) was admitted to the Bar of this Court on June 18, 1987. On September 12, 2001, the Attorney Grievance Commission of Maryland (hereinafter “Bar Counsel”), acting pursuant to Maryland Rule 16-709(a), filed a petition for disciplinary action against McLaughlin charging numerous violations of the Maryland Rules of Professional Conduct (hereinafter “MRPC”), 1 including MRPC 1.4 ⁴⁷² (Communication), 2 MRPC 1.5 (Fees), 3 MRPC 1.7 (Conflict of ⁴⁷³ Interest), 4 MRPC 1.8(a) (Conflict of Interest: Prohibited Transactions), 5 MRPC 1.15 (Safekeeping Property), 6 MRPC ⁴⁷⁴ 1.16(d) (Declining or Terminating Representation), 7 MRPC 8.4(b),(c) & (d) (Misconduct), 8 Maryland Code, Section 10-304 of the Business Occupations and Professions Article (1989, 2000 Repl.Vol.) (Deposit of Trust Money), 9 Section 10-306 of the Business Occupations and Professions Article (1989, 2000 ⁴⁷⁵ Repl.Vol.)(Misuse of Trust Money), 10 and Section 19-346(n) of the Health-General Article (1982, 2000 RepLVol.). 11 The charges involved numerous financial arrangements that McLaughlin had with Scott Perkins (hereinafter “Perkins”), Glennys R. Wise (hereinafter “Wise”), Roland Burker (hereinafter “Burker”), Arlene M. Glomp (hereinafter “Glomp”), and ⁴⁷⁶ Mariner Health of Bel Air (hereinafter “Mariner Health”) from July of 1998 and throughout 1999. This Court referred the petition to Judge Robert N. Dugan of the Circuit Court for Baltimore County for a hearing to determine findings of fact and conclusions of. law pursuant to Maryland Rule 16-706(b).

The subsequent procedural history of this matter was summarized by Judge Dugan as follows: Respondent was served with the Writ of Summons, the transmittal Order of the Court of Appeals and the Petition for Disciplinary Action. On November 16, 2001, Respondent filed a general denial plea. Upon Petitioner’s Motion to Extend Time Within Which to Conduct a Hearing and without objection by Respondent, the Court of Appeals extended the hearing date to January 25, 2002. On December 13, 2001, Petitioner propounded upon Respondent both Interrogatories and a Request for Admissions of Fact.

Respondent filed a Motion to Shorten Time and a Motion to Strike Appearance which were argued in this Court on January 18, 2002. .Because a granting of the Motion to Strike appearance would then necessitate a request for a continuance by the Respondent and such a request could only be entertained by the Court of Appeals, this Court suggested that Respondent file said motions with the Appellate Court. Subsequently, the Court of Appeals granted the Motion to Strike Appearance of Respondent’s counsel and extended the hearing date to March 5, 2002. Due to Respondent’s failure to respond to Petitioner’s discovery requests, Petitioner filed a Motion for Sanctions. In turn, Respondent then filed a Motion for Continuance to the Court of Appeals on March 5, 2002, which was later denied.

Consequently, a hearing on the merits commenced before this Court on March 5, 2002. During the hearing on March 5, 2002, at which McLaughlin represented himself, Bar Counsel introduced admissions of fact, which had been deemed admitted by McLaughlin because he had failed to respond to them. The transcript of the ⁴⁷⁷ deposition of Jason Frank, who had been called as an expert in “elder law,” with attendant exhibits, was admitted without objection. Respondent offered no evidence to contradict the admissions of fact during the hearing, although upon a post-hearing motion, he had been permitted to file, by April 15, 2002, a memorandum in answer to the admissions of fact.

McLaughlin, however, failed to file any memorandum in answer to the admissions of fact as of April 22, 2002, the date of Judge Dugan’s Opinion. That opinion was filed in the Circuit Court on April 80, 2002 and in this Court on May 24, 2002. Accordingly, the following facts, which were admitted on March 5, 2002, were deemed accurate and true: 1. The Respondent concentrates his area of practice in medical assistance eligibility for long term care benefits. 2.

In order for an applicant to be eligible for Medical Assistance Long Term Care Benefits, the applicant must meet three eligibility requirements: technical, financial and medical. 3. The basic financial eligibility criteria are: (1) countable resources must be $2,500 or less and (2) income must be insufficient to meet the costs of care. 4. The Respondent’s efforts were concentrated to assist his clients in preserving, protecting, or otherwise disposing of their personal assets in such a way as to maximize the distribution of those assets to heirs, beneficiaries and family members and still be eligible to receive medical assistance under the appropriate federal and state laws and regulations. 5. In furtherance of the Respondent’s practice to assist his clients in the protection, preservation and distribution of their personal assets, he attempted to utilize various planning techniques which collectively he termed an ‘asset protection plan.’ 6.

Respondent, in connection with his representation of clients seeking “protection of assets as a result of entry into a nursing facility and the need to qualify for medicaid for nursing home payment,” uses a multiple ⁴⁷⁸ page fee agreement that, in essence, breaks down the overall fee into two subcategories. 7. The first category or portion of the fee is termed a “design engagement fee” or “design fee.” The design fee is a set fee that will vary from client to client, which serves to pay the Respondent “for the initial investigation and advice” in connection with his preparation of an asset protection plan. 8. Pursuant to the terms of the agreement, an “asset protection plan” is to be provided to the client at the completion of that stage. 9. The second portion, or subcategory, of the fee is termed an “implementation engagement fee” or “implementation fee.” That fee is characterized as a “contingent, sliding scale” fee which the Respondent bases “on a set percentage of the protected savings” which he determines to be applicable under the asset protection plan which he proposed. 10.

The implementation fee is a percentage, usually twenty-five percent (25%) of the savings estimated by the Respondent to be achieved under his proposed asset protection plan. 11. Respondent, by the terms of his fee agreement, deems “all fees under [that] agreement are earned when paid” and deposits of such fees are to be made into his operating account, rather than his escrow account. 12. Respondent, by the terms of his fee agreement, acknowledges there are circumstances that would require the return of the fee charged against, and collected from, the client. Even when it is acknowledged the fee should be returned due to the inability to qualify the client for medicaid, the Respondent may exercise “the option of returning the funds within thirty days with no interest OR returning the funds within a longer period of time at ten percent (10%)/year of interest, essentially granting himself loan of those funds. ⁴⁷⁹ 13.

In or about July, 1992, Loretta S. Perkins suffered a cerebral stroke which left her with significant left side deficits and subsequent life long disability. 14. Her husband, Toney R. Perkins was her caretaker from that event until his death in December, 1998. 15. In February, 1998, Mr. Perkins was diagnosed with colon cancer and underwent surgery, chemotherapy and radiotherapy. With this subsequent debilitation full time care givers were hired and the need for long term planning became more obvious. 16.

Consequently, the Perkins, through their son, Scott Perkins, initiated contacts with the Respondent and entered into a fee arrangement with him on or about November 23,1998. 17. The fee agreement between the Respondent and Toney Rodney Perkins and Loretta Sue Perkins established a $9,000 design fee and a twenty-five percent (25%) implementation fee to be applied towards the savings from the asset protection plan called for under the fee agreement. 18. On or about December 22, 1998 Toney R. Perkins paid to Respondent, by check number 2371, the amount of $5,000 as a design fee. 19. Anthony Perkins died on December 23,1998. 20.

By letter dated February 15, 1999 the Respondent proposed certain changes to the fee agreement of November 23, 1998, that, inter alia, called for an additional payment of $35,000, bringing the total fee to $40,000. This amendment was accepted by Scott Perkins as attorney-in-fact for his mother, Loretta Sue Perkins. 21. By check dated February 25, 1999 Scott Perkins paid $35,000 to the Respondent as the balance due under the fee agreement. 22. By letter of complaint dated October 18, 1999, Scott Perkins brought Respondent’s conduct to the attention ⁴⁸⁰ of the petitioner and alleged that Respondent had failed to perform any appreciable services in return for the payment of $40,000, failed to provide any asset protection plan, failed to implement any plan, or to undertake any positive action on behalf of Loretta S. Perkins. 23.

Respondent was made aware that Loretta Perkins, after the death of her husband, had no intention of entering into a nursing home and that any “asset protection plan” would never, therefore, be needed, let alone ever implemented. 24. Although the Respondent had indicated to Scott Perkins, acting under power of attorney for Loretta S. Perkins, that he would return the entire $40,000 fee should Ms. Perkins be unwilling to ever enter a nursing home, the Respondent failed to return any portion of the fee. 25. Between February 1999, and October 18, 1999, when he filed his complaint with the Attorney Grievance Commission, Scott Perkins made numerous attempts to discuss, the subject matter of the legal representation with the Respondent and the Respondent failed to respond to those efforts to obtain information by Ms. Perkins. 26. After numerous requests for a refund by Scott Perkins, on behalf of his mother, to which Respondent made no substantive response, eventually by October, 1999, Respondent agree to return the fee at the rate of $750 a month to include payments of ten percent (10%) interest on the $40,000 fee. 27.

Respondent’s representation of the contrary notwithstanding, he has failed to refund or return any of the unearned fees of Loretta S. Perkins and misappropriated those funds for his own personal and business purposes. 28. Respondent exhausted those funds so that they were unavailable to be returned to his clients. ⁴⁸¹ 29. The Respondent failed to render any appreciable legal services on behalf of Loretta S. and Toney R. Perkins. 80. Respondent failed to deposit the fees paid on behalf of Toney R. and Loretta S. Perkins in a fiduciary or escrow account. 81.

Respondent failed to return the unearned portions of those fees. 82. Respondent failed to advise his clients that they should consult with counsel before entering into a retainer agreement with him which, in substantial part, constitutes the provisions of an unsecured loan document and therefore a business transaction between he and his clients. 83. In or about July, 1998, Glennys R. Wise engaged the Respondent to qualify her mother, Irene Ellsworth, and her aunt, Edna Terhall, for medical assistance. At that time both women were residents of Hamilton Center, Genesis Elder Care. 84.

The Respondent charged Ms. Wise a fee of $12,000 to qualify the women and ascertained there was a financial disqualification due to the excess resources they held. Respondent identified $21,530 to be excess resources otherwise disqualifying his clients from medical assistance. 35. The Respondent, as part of his asset protection plan, had Ms. Wise, her mother and her aunt turn over $21,530 to him to be held in his escrow account as agent for the nursing home. 36. The Respondent was aware or at least contended that his clients owed the nursing home an amount in excess of $21,530 and proposed to “negotiate” with the nursing home against their existing bill with the $21,530 entrusted to him. 37.

The Respondent failed to notify the nursing home that he was holding $21,580 on their behalf as his principal, ⁴⁸² and nonetheless purported to negotiate with them to their detriment or adverse interest. 38. Irene Ellsworth, the mother of the Complainant, died on March 12,1999. 39. In or about July 1999, the Department of Social Services ruled that the $21,500 held in the Respondent’s escrow account was in fact available to Irene and Edna and, therefore, effectively rendered them ineligible for medical assistance. Although Respondent was made aware that the Department of Social Services rejected benefits in favor of his clients in July 1999, due to their determination that the funds he maintained in escrow , were available to them, he failed to pay those funds over to the nursing home until October 1999. 40.

Respondent failed to substantively perform any services of any appreciable value for the benefit of Ms. Wise, her mother or her aunt. 41. Respondent failed to refund any unearned fees as demanded by Ms. Wise. 42. Respondent failed to advise his clients to seek the advice of counsel before entering into a retainer agreement with him which, in substantial part, constitutes the provisions of an unsecured loan document and, therefore, a business transaction with his clients. 43. Respondent deposited the $12,000 retainer fee in his operating account and failed to separately maintain those funds as fiduciary funds separate and apart from his own.

He, in fact, used those funds for his own purposes and exhausted those funds so that they were not available to be refunded to his clients. 44. On or about October 25, 1999 Roland Burker and his wife met with Respondent to pursue obtaining an asset protection plan for the benefit of Mary G. McNulty, Complainant’s sister, for whom they had power of attorney. ⁴⁸³ 45. Respondent assured Mr. Burker and his wife he could protect at least $60,000 of these assets of Ms. McNulty. 46. Mr. Burker and his wife met with Respondent on November 8th and at that time were presented with a retainer agreement which they executed on that date.

The retainer agreement called for a design fee of $10,000 and an implementation fee of twenty-five percent (25%) of savings. 47. During that meeting Mr. Burker inquired of the Respondent when the design fee should be paid and the Respondent indicated that day. At that time a followup appointment was established for November 15th and Mr. Burker and his wife left the office. 48. After leaving the office Mr. Burker arrived at his home and was, within thirty minutes, met there by Respondent’s assistant who was dispatched to obtain Mr. Burker’s personal check in the amount of $10,000 for the design fee. 49.

Although a copy of the retainer agreement was to have been provided at that time, the assistant failed to bring the executed document. 50. The following day, November 9th, at approximately 11:00 a.m. after returning to their residence, Mr. Burk-er reviewed his answering machine, which contained a message from the teller at his bank branch. The message was left in an attempt to verify the validity of a check presented for payment and, in the background, a man’s voice was heard to say that he was the attorney of the account holder. The teller’s message went on to say that the call should be disregarded and terminated at that time. 51.

A second message was on the machine indicating that the teller required Mr. Burker to call her upon his return. 52. Mr. Burker contacted the teller and was informed that the Respondent had appeared at the bank and wanted ⁴⁸⁴ to negotiate the $10,000 check from Mr. Burker and have the teller issue a cashiers check in that amount. 53. Mr. Burker, alarmed that his check was so quickly negotiated and concerned for the propriety of the transaction, contacted the Respondent. At that time the Respondent indicated that.he “needed the funds because of his cash flow problems.” 54.

Upon hearing this representation Mr. Burker immediately decided to terminate the representation and went to the Respondent’s office the next morning to obtain a copy of the retainer agreement and a receipt for the funds. He immediately wrote a letter to the Respondent rescinding the retainer agreement, discharging the Respondent and asking for a one hundred percent (100%) refund of the design fee. 55. Mr. Burker took that letter with him to the scheduled appointment on November 15th but was informed that the Respondent could not be present at the meeting. He left the discharge letter at. the office at that time. 56.

On November 30th the Respondent contacted Mr. Burker after Mr. Burker’s efforts to contact him had been unsuccessful, and acknowledged that he had done nothing to earn the $10,000 fee and would return the entire amount. 57. He went on to inform Mr. Burker that he had, pursuant to his retainer agreement, thirty days to decide whether or not to repay the fee in full or to pay at ten percent (10%) interest per year over a longer period of time. Respondent gave Mr. Burker an appointment for December 6th at 4:00 p.m. to render his decision as to the repayment policy he would adopt. 58. On December 6th Respondent met with Mi*.

Burker and informed him that he was exercising his option to pay the $10,000 at a rate of $500 per month, gave Mr. Burker the first check for $500 and informed him that he would provide Mr. Burker with an amortization ⁴⁸⁵ schedule and another check in or about December 31, 1999 and monthly thereafter. 59. The Respondent failed to timely make the payments of $500 per month and, in fact, has not made any additional payments. 60. The Respondent, at the time that he promised to repay the $10,000 with interest, was aware that he did not have the ability to make those payments nor did he have any expectation of being able to make those payments. 61. At the time the Respondent took Mr. Burker’s $10,000 he knew that he would, and did, expend all of those funds on his own personal and professional purposes and would be without any reliable source of repayment. 62.

The Respondent failed to refund unearned fees. 63. Respondent failed to deposit unearned fees in a fiduciary account. 64. Respondent failed to safeguard the property of his client. 65. Respondent failed to advise his clients to consult with counsel before entering into a retainer agreement which essentially established a business transaction between he and his clients in the form of an unsecured loan. 66.

In or about August 1999 Arlene M. Glomp and her two brothers met with Respondent to consider the financial eligibility of their mother for long term continuous care and the possibility of preserving some of her assets, which approximated $200,000 to $220,000. The initial meeting with the Respondent was to be a free consultation to discuss with the family, with some specificity, what his services would include and what possibilities they may pursue. 67. At a second meeting later in August 1999 or early September 1999, the family members met with Respondent again and executed a retainer agreement ⁴⁸⁶ without having been advised of their right to consult counsel about various terms and conditions within the retainer agreement. 68. Pursuant to that agreement they were requested to provide a design fee in the amount of $10,000, which was paid. 69.

Thereafter Respondent met with Ms. Glomp on approximately two separate occasions and on one occasion, which took place at the nursing care facility, his secretary delivered a power of attorney document for the benefit of Ms. Glomp’s mother, a patient there. 70. The Respondent met with Ms. Glomp only one additional time in late September that included a one-half hour session with a financial planner and a brief meeting in October. 71. Thereafter no substantive work was done by the Respondent nor was there any communication with Ms. Glomp and her family about the asset protection plan and its progress or lack thereof. 72. Ms. Glomp’s mother died on December 21, 1999 and thereafter the Respondent was notified of her demise and requested to return the unearned portion of the fees, which Ms. Glomp expected would be substantial since she saw no work product. 73.

Although Ms. Glomp had not been presented with an asset protection plan the Respondent persisted in attempting to collect a $16,000 implementation fee which he contended was due. 74. Ms. Glomp refused to pay any additional funds because she never did receive an asset protection plan. 75. Despite numerous requests for a refund, the Respondent failed to return any of the unearned portions of his fee. 76. Respondent failed to respond to requests for information by his client in connection with the legal matter for which he was retained. ⁴⁸⁷ 77.

Respondent failed to safeguard the funds of his client by depositing those funds in an escrow account. 78. Respondent exhausted all funds entrusted to him by Ms. Glomp for his own personal and professional purposes. 79. On or about April 8, 1999 the Respondent entered into a financial agreement with Mariner Health of Bel Air as the agent for a resident in that health care facility, his mother, Anne McLaughlin. 80. The Respondent executed the agreement as agent under a financial power of attorney granted to him by his mother and represented to the facility that she had third party insurance through Transport Life — Conseco from whom he agreed to make payments on her behalf to the facility.

In the agreement the Respondent executed as agent on behalf of his mother he acknowledged the misuse of assets or income of the resident is a misdemeanor subject to fine up to $10,000 and considered an “abuse of funds.” 81. The Respondent contacted Transport Life — Conseco and instructed the insurance company to remit future payments on behalf of his mother to him personally rather than to the health care facility, Mariner Health of Bel Air, Inc. As a result, Respondent came into possession of approximately $28,000 of funds from the insurance company attributable to the care and expenses incurred on behalf of his mother by Mariner Health of Bel Air, Inc. 82. The Respondent exercised control, pursuant to a power of attorney, over his mother’s checking account and funds and transferred $22,000 from his mother’s checking account to his own personal account or to his law firm’s operating account. 83. The Respondent misappropriated the funds and assets of his mother over which he exercised a fiduciary obligation under a power of attorney and used those funds for his own personal, professional or familiar ⁴⁸⁸ purposes other than the expenses for the care of his mother for which they were intended.

In assessing these facts, Judge Dugan made the following conclusions of law: CONCLUSIONS OF LAW Rule 1.4 of the Maryland Professional Rules of Conduct provide that “a lawyer shall keep a client reasonably informed about the status of a matter and promptly comply with reasonable requests for information.” By failing to respond to Scott Perkins’s numerous attempts to discuss the status of his mother’s asset protection plan, for which Respondent was hired to prepare, Mr. McLaughlin clearly violated the ethical duty required by Rule 1.4. Similarly, after being hired by Arlene Glomp and her brothers to consider “the financial eligibility of their mother for long term continuous care and the possibility of preserving some of her assets,” McLaughlin failed to communicate with his clients about his progress on the asset protection plan. Thus, the Court finds that, as to both cases, Respondent was in violation of the Maryland Code of Ethics. It is clear from the facts that Mr. McLaughlin, in violation of Maryland Rule of Professional Conduct 1.5(a) which requires a lawyer’s fee be reasonable, charged an exorbitantly excessive fee in each of the four cases at issue.

Among the factors to be considered when determining whether a fee is reasonable is the amount of work involved and the results obtained. Respondent did not provide any of his clients with the asset plans he was hired to produce and for this failure to render any appreciable legal services he collected and retained fees in excess of $72,000. By charging and keeping these fees for work that he knew he had not done and, clearly, did not plan to do, Respondent also violated Maryland Rule of Professional Conduct 8.4(c) prohibiting a lawyer from engaging in conduct involving “dishonesty, fraud, deceit or misrepresentation.” The ethical Rule addressing the safekeeping of property, found at Maryland Professional Rule of Conduct 1.15, re ⁴⁸⁹ quires a lawyer to “hold property of clients that are in [his or her] possession in connection with a representation separate from the lawyer’s own property” and to keep such funds “in a separate account.... ” Further, the Business Occupations and Professions Article of the Maryland Annotated Code, Sections 10-304 and 306 mandate that client trust funds must be deposited in a separate trust account and that a lawyer “may not use trust money for any purpose other than the purpose for which the trust money is entrusted to the lawyer.” By depositing the retainer fees charged to each of his clients into his operating account and, thus, failing to keep such monies separate and apart from his own and by negotiating Mr. Burker’s $10,000 retainer fee into a cashiers check for his own use rather than placing it into a trust account, Respondent clearly violated Rule 1.15 and Section 10-304 of the Business Occupations and Professions Article. Mr. McLaughlin dug the hole even deeper by exhausting the fees, charged for work not performed, for his own personal and professional purposes.

In violation of Section 10-306 of the Business Occupations and Professions Article, Mr. McLaughlin, without question, misappropriated the funds with which he was entrusted. Lawyers are clearly prohibited from entering into attorney-client relationships where such representation will result in a conflict of interest with another client and are, as well, prohibited from entering into business, financial or property transactions with a client unless “the transaction is fair and equitable to the client” and “the client is advised to seek the advice of independent counsel in the transaction and is given a reasonable opportunity to do so.” Maryland Rules of Professional Conduct 1.7, 1.8. By the terms of Respondent’s standard fee agreement with each of the four clients in this case, it is recognized that there are particular circumstances under which the fee charged and collected should be returned. Even where the client fails to qualify for medicaid and an asset plan cannot be prepared, the Respondent is permitted to exercise one of two options when refunding the fees retained: he may return the funds ⁴⁹⁰ within thirty days with no interest or return the funds over a longer period of time at a ten percent (10%) interest per year.

It is the second option which essentially transforms the attorney-client relationship into a business transaction whereby Mr. McLaughlin is granted a loan that may be repaid over a period of time that is governed by his sole discretion. None of his clients were advised that they should seek the advise of additional counsel before entering into such an agreement nor were they given an opportunity to do so. It is, as well, debatable whether such a contract is fair and equitable to each of the clients. Consequently, Respondent created a business relationship with his clients in violation of the ethical Rules.

Upon the termination of representation, a lawyer “shall take steps to the extent reasonably practicable to protect a client’s interest, such as ... surrendering papers and property to which the client is entitled and refunding any advance payment of fee that has not been earned. Respondent acted in contravention of this Rule when he failed to return to his clients property to which they were entitled, including a refund of advanced payment of fees that he did not earn. Finally, Respondent impermissibly and improperly retained the $28,000 paid to him by Transport Life — Conseco as part of the payments due and owing to the health care facility, Mariner Health of Bel Air, Inc., pursuant to its insurance contract. As agent for his mother, Respondent was obligated to pay third party insurance that was received on her behalf to the facility.

Yet, in direct violation of this agreement, Mr. McLaughlin illegally kept them for his own use and did not place them in a separate trust account. Not only does this violate the Health and General Article of the Annotated Code of Maryland, Section 19-346(n) which prohibits an attorney from using the assets or income of a resident of a health care facility for any purpose that is not authorized by the resident, designee or legal representative, but also Maryland Professional Rules of Conduct 1.15(a) for his failure to place the funds in a separate trust account, ⁴⁹¹ 8.4(c) and (d) for his dishonest, fraudulent and deceitful misconduct that has been prejudicial to the administration of justice and Business Occupations and Professions Article, Section 10-304 and 306 for using trust funds in a manner other than which they were intended. Rule 8.4(b), although cited in the complaint as being violated by the retention of the $28,000, was not charged and has thus been abandoned by the Petitioner. Judge Dugan, thus, determined that McLaughlin’s acts and omissions constituted violations of MRPC 1.4 (Perkins and Glomp matters); MRPC 1.5(a) (Perkins, Glomp, Wise and Burker matters); MRPC 1.15 and Sections 10-304 and 306 of the Business Occupations and Professions Article (Perkins, Glomp, Wise and Burker matters); MRPC 1.7 and MRPC 1.8 (Perkins, Glomp, Wise and Burker matters); MRPC 1.16(d) (Perkins, Glomp, Wise and Burker matters); MRPC 1.15(a), MRPC 8.4(c), MRPC 8.4(d) and Sections 10-304 and 10-306 of the Business Occupations and Professions Article, and Section 19-346(n) of the Health-General Article (Mariner Health matter).

Bar Counsel took no exceptions to Judge Dugan’s findings of fact and conclusions of law and recommended McLaughlin’s disbarment. On August 5, 2002, McLaughlin filed in this Court a motion to remand to which Bar Counsel filed an opposition. That motion was denied by this Court on August 21, 2002. 12 Represented by new counsel, McLaughlin, on October 28, 2002, filed a motion asking the Court to reconsider the motion to remand. On that same day, McLaughlin also filed a motion to extend time Nunc Pro Tunc, in which he sought an extension of time for filing exceptions to the findings of fact and conclusions of law.

He appended proposed exceptions to the motion. Those proposed exceptions alleged that McLaughlin had been suffer ⁴⁹² ing from various psychiatric conditions and had not been represented by counsel during the grievance hearing. These conditions, McLaughlin alleged, had left him unable to respond to the request for admissions of fact, which Judge Dugan had relied upon in rendering his opinion. Oral argument before this Court occurred on October 31, 2002, after which we filed a per curiam order, disbarring respondent forthwith on November 1, 2002. 13 The order stated: For reasons to be stated in an opinion later to be filed, it is this 1st day November, 2002, ORDERED, by the Court of Appeals of Maryland, that Thomas J. McLaughlin, be, and is hereby, disbarred, effective immediately, from the further practice of law in the State of Maryland; and it is further, ORDERED that the clerk of this Court shall strike the name of Thomas J. McLaughlin form the register of attorneys, and pursuant to Maryland Rule 16-713, shall certify that fact to the Trustees of the Client Protection Fund and the clerks of all judicial tribunals in the State; and it is further, ORDERED that respondent shall pay all costs as taxed by the clerk of this Court, including the costs of all transcripts, pursuant to Maryland Rule 16 — 715(c), for which sum judgment is entered in favor of the Attorney Grievance Commission of Maryland against Thomas J. McLaughlin.

Accordingly, we now state the reasons for our previously issued order. I. Standard of Review As the court of original and complete jurisdiction for attorney disciplinary proceedings in Maryland, we conduct an independent review of the record. Attorney Grievance Comm’n v. Garfield, 369 Md. 85, 97 , 797 A.2d 757, 763 (2002) (citing Attorney Grievance Comm’n v. Snyder, 368 Md. 242 , ⁴⁹³ 253, 793 A.2d 515, 521 (2002) (citing Attorney Grievance Comm’n v. Garland, 345 Md. 383, 392 , 692 A.2d 465, 469 (1997))). The hearing judge’s findings of fact will be accepted unless we determine that they are clearly erroñeous.

Garfield, 369 Md. at 97 , 797 A.2d at 764 . We recently iterated in Attorney Grievance Comm’n v. Dunietz that, “[a]s to the hearing judge’s conclusions of law, ‘our consideration is essentially de novo.’ ” 368 Md. 419, 428 , 795 A.2d 706, 710-711 (2002) (quoting Attorney Grievance Comm’n v. Thompson, 367 Md. 315, 322 , 786 A.2d 763, 768 (2001) (quoting Attorney Grievance Comm’n v. Briscoe, 357 Md. 554, 562 , 745 A.2d 1037, 1041 (2000))).

II

Discussion A. Respondent’s Proposed Exceptions. Respondent has alleged that he was denied a fair hearing because he had to represent himself on March 5, 2002, after his counsel withdrew their appearance on January 23, 2002. According to McLaughlin, any problems that resulted from his self-representation and his failure to respond to the requests for admissions of fact should be excused because he lacked litigation skills and suffered from a psychiatric condition. McLaughlin, however, fails to take responsibility for the countless times that the hearing judge, to no avail, gave him opportunities to seek legal counsel, raise objections, and respond to the requests for admissions of fact. 14 Gratuitously, the hearing judge had even gone so far as to afford McLaughlin a post-hearing continuance to respond by April 15, 2002.

During that post-hearing hiatus between March 5 and April 22, 2002, 15 McLaughlin did not file any response to the re ⁴⁹⁴ quests for admission of fact, even though he had been afforded the additional time to do so. Respondent now requests a remand for an entirely new hearing to attempt to prove that he, in fact, earned all of the money that he was paid by the complainants. The hearing judge found and this Court agrees, as we shall discuss, that McLaughlin charged fees in excess of $72,000 for work he had not done. Thus, a remand is not appropriate.

Having been given a fair opportunity to be heard on the request for admissions of fact, McLaughlin has exhausted his entitlement to further judicial proceedings. See Attorney Grievance Comm’n v. Harris, 366 Md. 376, 391 , 784 A.2d 516, 525 (2001) (citing Attorney Grievance Comm’n v. Stewart, 285 Md. 251, 259 , 401 A.2d 1026, 1030 (1979) (recognizing that, if a lawyer is given notice and the opportunity to defend in a full and fair hearing, the question of whether he was accorded due process of law is ordinarily immaterial)). B. Respondent’s Scheme of Design and Implementation Fees For an appreciation of what McLaughlin offered to his clients who wanted to qualify for Medicaid nursing care benefits, it is necessary to understand the requirements that an applicant must satisfy to be eligible for such benefits. Judge Eldridge for the Court, in Jackson v. Millstone, 369 Md. 575, 580-82 , 801 A.2d 1034, 1036-38 (2002) (footnotes omitted), described the framework of Maryland’s medical assistance plan: Congress enacted the Medicaid Act in 1965 as Title XIX of the Social Security Act.

See 42 U.S.C. § 1396 et seq.; 42 C.F.R. §§ 430-456 . The Act was designed to enable states, as far as practicable, to furnish medical assistance to individuals whose income and resources are insufficient to meet the costs of necessary medical services. To that end, the Act established a medical assistance program, which is a jointly funded collaboration between the states and the federal government. It is a voluntary program, in which a state may elect, but is not compelled, to participate.

When a state elects to participate in the medicaid program, it ⁴⁹⁵ prepares and submits for approval by the federal Health Care Financing Administration, the federal agency that administers the Federal Medical Assistance Program, a state medicaid plan for the provision of medical assistance that complies with the federal Medicaid Act and with the regulations promulgated by the Secretary of the Department of Health and Human Services. See 42 U.S.C. § 1396a (a); 42 C.F.R. §§§ 430-456. If the federal agency approves the state plan, then the state qualifies for federal funding, whereby the federal government will reimburse the state up to 50% of the cost of the medicaid program. See, 42 U.S.C. § 1396b(a); 42 U.S.C. § 1396d(b).

While the federal government establishes broad policy, secures state compliance with the statute, and dispenses federal funds to supplement state spending on medicaid, there exists some latitude for each state to determine which of its citizens qualify for this form of medical insurance and which services its program will provide. The state agency charged with dispensing the state medicaid program is responsible for interpreting, administering, and complying with federal medicaid statutes and regulations. Within broad federal rules, each state decides eligibility groups, types and range of services, payment levels for services, and administrative and operating procedures. Maryland has chosen to participate in the medicaid program.

It does so through the Maryland Medical Assistance Program, operated by the Department of Health and Mental Hygiene. See Maryland Code (1982, 2000 Repl.Vol., 2001 Supp.) § 15-103 of the Health General Article. The program’s director, or a designee, is responsible for the approval or denial of applications for preauthorization for payment. Preauthorization, or approval from the Department, is required before one can receive medical assistance benefits.

See COMAR 10.09.06.01B(30). Although the federal Medicaid Act only mandates that states provide medical assistance for those classified as ⁴⁹⁶ “categorically needy,” Maryland’s state plan is designed to provide comprehensive health care services for “categorically needy” and “medically needy” persons. See §§ 15-201.1, 15-103 of the Health General Article; COMAR 10.09.06.01B(21). See also. 42 U.S.C. § 1396a(a)(10)(A), (C) (listing those who qualify as “categorically” and “medically” needy, respectively).

Under the Maryland Medicaid Plan, “categorically needy” includes “aged, blind, or disabled persons, or families and children, who are otherwise eligible for Medical Assistance and who meet the financial eligibility requirements for FIP, SSI, or Optional State Supplement.” COMAR 10.09.24.02B(11). Essentially, “categorically needy” persons are those whose income levels are so low that they qualify to receive cash assistance from an approved state program, and they cannot afford to pay for basic needs or medical assistance. The “medically needy,” on the other hand, are “persons who are otherwise eligible for Medical Assistance, who are not categorically needy, and whose income and resources are within the limits set under the [s]tate [p]lan.” COMAR 10.09.24.02B(38). See Jaffe v. Sharp, 463 F.Supp. 222 (D.Mass.1978) (defining the “medically needy” as individuals and families whose income exceeds that of categorically needy but is nevertheless insufficient to cover medical care).

As Judge Eldridge pointed out, an applicant seeking “medically needy” status must meet certain financial criteria, the satisfaction of which depends on the applicant’s income, and resources. See COMAR 10.09.24.07 (setting out the income considerations); COMAR 10.09.24.08 (setting out the resource considerations). To be eligible, an applicant’s available income must be less than the cost of his or her care. COMAR 10.09.24.07.

In addition, an individual applicant will not qualify for benefits if he or she owns more than $2,500 worth of available assets. COMAR 10.09.24.08M. Eligibility is denied if an applicant, to reach the resource standard, made certain non-exempt transfers of his or her assets within the 36 months preceding the application. COMAR 10.09.24.08-1B(2).

Examples of exempt transfers include transfers of assets to a ⁴⁹⁷ spouse for the sole benefit of the spouse, transfers