LOS ANGELES – A disbarred lawyer was sentenced today to 144 months in federal prison for stealing settlement money from multiple clients, including a multimillion-dollar settlement that should have been paid to a victim of a car accident, and for cheating on his federal taxes on Income.
Philip James Layfield, aka “Philip Samuel Pesin”, 48, formerly of Coto de Caza, was convicted by US District Judge Michael W. Fitzgerald, who said in court that Layfield’s actions were “appalling” and that his criminal conduct was “pure evil”. .”
Judge Fitzgerald found the total loss in this case to be approximately $5,552,756. The exact amount of restitution Layfield will be ordered to pay his victims will be determined at a hearing scheduled for May 12.
Following a 13-day trial in August 2021, a federal jury found Layfield guilty of 19 counts of wire fraud, one count of mail fraud, one count of tax evasion, one count of failure to collect and pay payroll taxes, and a misdemeanor charge of failure to file a tax return.
Layfield owned and operated law firms, including Layfield & Barrett (L&B), which at various times had offices in Los Angeles; Irvine; El Segundo; Park City, Utah; and Scottsdale, Arizona.
After embezzling millions of dollars from client settlements, Layfield moved to Costa Rica. Just before boarding a flight to Costa Rica, Layfield borrowed $700,000 from a commercial lender by providing misleading information and failing to disclose important information. He then used a significant portion of the loan proceeds for personal expenses, including buying a horse and shipping horses to Costa Rica.
In one case, Layfield entered into an agreement to represent a person who was struck by an automobile in Orange County and suffered serious injuries. After negotiating a $3.9 million settlement related to the accident, Layfield diverted the money owed to the victim – approximately $2 million – for unrelated personal and business purposes, including paying clients whose settlement proceeds that Layfield had previously misappropriated. Long after Layfield embezzled the victim’s settlement proceeds, Layfield attempted to appease the victim by paying him $25,000 from other clients’ settlement proceeds.
Layfield also failed to file a federal tax return for the 2016 tax year, despite receiving more than $3 million, including misappropriated client settlement money. Layfield also arranged for his law firm not to pay approximately $120,000 in payroll taxes to the United States government for the second quarter of 2017.
“The evidence, including [Layfield’s] own testimony, showed that [Layfield] repeatedly stole money from his trust account that he should have paid to his clients who suffered horrific bodily injuries,” prosecutors argued in a sentencing memorandum. “They hired [Layfield] to bring them closure and some relief. Their faith in the justice system shaken, [Layfield] added to the stress and anxiety of his clients by forcing them to hire other lawyers to try to recover the money from [Layfield]only to find little or nothing.
The State Bar of California disbarred Layfield in October 2018. Layfield was also a public accountant, but his CPA license expired in July 2019, according to the California Board of Accountancy.
Homeland Security Investigations, IRS Criminal Investigation and the FBI investigated this case.
United States Assistant Attorneys Mark Aveis and Carolyn S. Small of the Major Fraud Section and Ian V. Yanniello of the International Narcotics, Money Laundering and Racketeering Section prosecuted the case.