Lawyer Buried Truth in Casket Deal

The Securities and Exchange Commission and East Cobb resident Chalmer E. Detling II have reached a settlement in the case, which already earned him a bar reprimand.

East Cobb lawyer Chalmer E. Detling II has agreed to pay a federal fine to settle a Securities and Exchange Commission complaint involving a failed West Virginia casket company.

It’s a case that already resulted in bar discipline against Detling, who lives on Clubland Court, according to the bar directory.

The SEC announced Tuesday that it filed a civil action against Detling last week in the U.S. District Court for the Northern District of Georgia.

The SEC’s description of what happened appears to contradict what Detling told the State Bar of Georgia in the discipline case that the Georgia Supreme Court resolved in May.

The SEC complaint, attached to this article, revolves around a client of Detling’s, Columbus businessman Charles Aiken, and Aiken’s purchase of manufacturer Continental Casket in Raleigh County, WV, more than five years ago.

Raleigh County issued $2.96 million in municipal bonds in October 2006 so that a company Aiken set up, Aiken Continental, could buy the casket maker. Detling served as Aiken’s attorney in the deal.

In official documents tied to the bond sale, the SEC says, Detling helped Aiken hide the fact that he was under federal indictment for fraud—a criminal case in which Detling was representing Aiken and was negotiating a plea deal for him.

Detling also failed to disclose that a company he partially owned lent $200,000 to Aiken to close the casket deal, the SEC says. Aiken had to repay the $200,000 plus $100,000 in interest within six months or hand over 20 percent of the casket business to Detling’s company.

Aiken Continental failed, and the bonds are in default.

Pending the court’s approval, Detling will pay more than $38,000 to settle the SEC complaint without admitting anything: $10,000 in disgorgement, the surrender of illicit profits; $3,052 in prejudgment interest; and a $25,000 civil penalty. The Raleigh County bondholders will split the money.

Detling also won’t be allowed to practice law before the SEC for at least five years.

Detling admitted failing to disclose Aiken’s criminal case during the casket deal in a bar disciplinary case last spring.

According to the decision issued by the state Supreme Court on May 31, attached to this article, Detling voluntarily filed for discipline before a formal complaint was filed against him for a rules violation that could have resulted in his disbarment.

The court decided to give him a Review Panel reprimand, although three justices wanted to give him a less severe reprimand.

The court found that Detling was remorseful, had a good reputation and made a one-time mistake because he was inexperienced. The D.C. Law School graduate became a bar member in 2004.

But the court ruling makes no mention of Detling’s financial interest in the casket deal through the $200,000 loan and says he had “no dishonest motive” in failing to disclose Aiken’s criminal case.

The court also says, “There is no indication that any connection exists between the business’ downfall and the director’s indictment or subsequent decision to enter a guilty plea.”

The SEC sees the case differently.


More »
Got a question? Something on your mind? Talk to your community, directly.
Note Article
Just a short thought to get the word out quickly about anything in your neighborhood.
Share something with your neighbors.What's on your mind?What's on your mind?Make an announcement, speak your mind, or sell somethingPost something
See more »