Local attorney Michael Eddings accused of professional conduct violations

jmustian@ledger-enquirer.comNovember 13, 2012 

A year into a Columbus real estate fallout, the State Bar of Georgia has begun disciplinary proceedings against attorney Michael A. Eddings, alleging a list of professional conduct violations that could jeopardize his law license.

The bar this month filed a thick formal complaint outlining 10 disciplinary matters that involve hundreds of thousands of dollars diverted from his firm's trust account. The allegations come as federal agents conducted an apparent search of Eddings' north Columbus law office Tuesday, carting off bins of documents sealed with FBI evidence tape.

Investigators wouldn't comment on their activity at 860 Brookstone Centre Parkway or the prospect of criminal charges, but the seizure seemed to highlight an intensifying law enforcement interest in the firm's dealings, even as Eddings remains mired in civil litigation. Eddings and his defense attorney, Rob Poydasheff, were seen conversing with the FBI, suggesting Eddings has continued to cooperate with investigators.

The bar complaint and FBI search marked the latest legal turmoil for Eddings, a well-known attorney and business owner whose fall from grace has stunned fellow attorneys and the local real estate community. Over the past year, Eddings, a former Army infantry officer, has seen his cafés and downtown restaurant shuttered and faced a flurry of lawsuits from clients whose lives were affected when Eddings' firm failed to pay off their mortgages at real estate closings.

"What's frustrating is we've done nothing wrong, but we're the ones that are paying the price," said Christa Humphrey, a former Columbus resident who fears Eddings' failure to pay off the mortgage on her home last year could affect her husband's credit and delay his retirement from the military. "I am a little bit frustrated by it because it is taking so long."

Eddings, 48, has filed for divorce and blamed his estranged wife for his firm's legal issues, portraying himself as a victim and accusing Sonya L. Eddings of converting more than $2 million from the escrow account. But the bar's 44-page complaint points out Michael Eddings' responsibilities as an attorney.

It claims he "allowed" improper withdrawals from his trust account and failed to keep "measures giving reasonable assurance that the conduct of non-lawyers employed or retained by him were compatible with his professional obligations." The bar requested a special master be appointed to hear the disciplinary proceedings, and Michael Eddings was given until early next month to respond to the allegations.

He referred a request for comment to Poydasheff, who did not return repeated messages Tuesday from the Ledger-Enquirer.

The fallout came to light about a year ago when Eddings' trust account was frozen and he was suspended from closing transactions amid an audit of his finances. Sonya Eddings told the auditors of a title insurance company more than a year ago that she failed to make several payoffs from closings and began, in 2007, transferring "small amounts" from the firm's escrow account to cover expenses for another business.

Sonya Eddings -- whose current address is listed as "unknown" in the bar complaint -- has insisted that no one else at the firm was aware of her actions. She also is accused of creating false wire confirmations to cover her actions but has not yet been charged.

First American Title Insurance Company has sued the Eddingses for conversion and fraud, claiming they failed to disburse more than $2 million after various real estate transactions.

The bar complaint rests on similar allegations, including the case of Humphrey, a typical victim of the missing payoffs.

Michael Eddings represented Humphrey and her husband, Dustin Humphrey, an Afghanistan war veteran formerly stationed on Fort Benning, when they sold their home in September 2011. According to the bar complaint, the lender deposited about $142,000 into Eddings' trust account, but the firm did not pay off the mortgage on the Humphreys' property.

Community Bankers Mortgage called the Humphreys in October 2011 asking for the mortgage payment, apparently unaware that the property had been sold. Dustin Humphrey called Eddings' office, the complaint says, and an unidentified employee "knowingly and falsely" told him the payment had been made via wire transfer "and that the situation would be remedied."

The Humphreys later received notice from Community Bankers Mortgage that a check drawn on Eddings' trust account had been returned due to a stop payment. The complaint says this led to foreclosure proceedings.

Christa Humphrey, who now lives in Springdale, Ark., said she fears the foreclosure will go forward now that her husband has returned from overseas. A foreclosure likely would mean her husband won't be able to retire from the military in four or five years as he planned, and it could hurt his credit and limit their ability to buy another home.

"The fact that this could affect his military career is just beyond me," she said. "How could anybody let that happen? It's not the bank's fault, but it's not our fault, either."

Ledger-Enquirer is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service