Mississippi law firm accused of failing to discover scheme
JACKSON, Miss. (AP) — An attorney trying to recover money from a $100 million Ponzi scheme in Mississippi says a law firm should have known about the scheme.
News outlets reported a federal complaint by court-appointed receiver Alysson Mills says the law firm and others contributed to the facade that made the scheme look legitimate to investors.
The complaint says Butler Snow and the founder and president of Butler Snow Advisories Services LLC, Matt Thornton, as well as Brent Alexander and Jon Seawright of the law firm Baker Donelson, helped Lamar Adams and Madison Timber.
Adams, through Madison Timber, operated a Ponzi scheme for more than 10 years that claimed to buy timber from Mississippi landowners and resell it to Mississippi lumber mills at higher prices.
Mills’ complaint said the two firms overlooked or failed to examine fraudulent business practices of Madison Timber which should have been obvious.
Mills says Butler Snow and Baker Donelson should be held liable for the “negligent and reckless acts of their agents.”
“Madison Timber would not have grown without defendants’ encouragement and assistance. Defendants lent their influence, their professional expertise and even their clients to Adams,” the complaint says.
Butler Snow and David Kaufman, the attorney representing Alexander and Seawright, strongly dispute the accusations and released statements in defense of their clients.
“We have cooperated fully with the receiver and provided all information she has requested. Therefore, she is well aware of our limited involvement with Mr. Adams and Madison Timber. Under these circumstances, filing a lawsuit against us and making these unfounded claims is disappointing,” a spokeswoman for Butler Snow said.
“Any suggestion that Brent and Jon were complicit in Lamar Adam’s Ponzi scheme is ridiculous,” Kaufman said.
Adams turned himself in to federal authorities in April. He pleaded guilty to one count of wire fraud and was sentenced to almost 20 years in prison.
Mills, as the receiver, is trying to recover some of the money invested in the scheme.