Bruce Matson is a former LeClairRyan attorney who was disbarred last year. (BizSense file)
Bruce Matson, a veteran Richmond attorney who was disbarred last year for his mishandling of millions of dollars in a major bankruptcy case, has been charged criminally by federal prosecutors.
The U.S. Attorney’s Office on Thursday hit Matson with one count of obstruction of an official proceeding related to his work as the trustee overseeing the bankruptcy of collapsed Henrico-based title insurance giant LandAmerica while he was employed at law firm LeClairRyan.
The brief two-page filing states that Matson “did corruptly influence, obstruct and impede, and endeavor to influence, obstruct and impede, the due and proper administration of the law under which a pending proceeding was being had before an agency of the United States, that is the United States Trustee Program.”
The U.S. Trustee Program is a component of the Department of Justice.
Matson was charged via the criminal information process, which does not require a grand jury indictment and typically involves cooperation from the defendant. Matson was not arrested as part of the charges.
He remains free at least until his initial court appearance at 10:30 a.m. July 22 before Magistrate Judge Mark Colombell. That proceeding will include a detention hearing. He’ll then immediately go before Judge John Gibney for arraignment and a plea agreement hearing.
A summons issued in the case indicates that Matson intends to plead guilty.
Matson is represented in the criminal matter by McGuireWoods attorney Brandon Santos, who declined to comment.
The filing claims the alleged obstruction took place over the course of Aug. 25-Nov. 25, 2019, but no further detail of the offense is included.
The charge comes more than a year after it was brought to light in bankruptcy court that Matson wrongfully withdrew nearly $3 million from the LandAmerica wind-down account and deposited it into his personal bank accounts and that of an associate.
Matson, who spent much of his 40-year law career as a bankruptcy trustee, oversaw the complex LandAmerica case from the time of the Henrico-based title insurance giant’s collapse in 2008 until its seemingly successful conclusion in 2015.
But in August 2019, it was discovered that the wind-down fund had been emptied. Those funds were not to be disbursed until the wind-down period came to a close in 2021.
Matson eventually admitted to taking the money out of the trustee account and was removed as trustee from the LandAmerica case, despite his objections. He has since repaid the funds back to the estate and was also disbarred by the Virginia State Bar, effectively ending his career in law.
He also recently paid an additional $577,000 to the LandAmerica estate for reasons that were not explained in bankruptcy court filings.
The missing trust account funds were discovered by Protiviti, which works as a financial advisor on bankruptcy cases, including those of LandAmerica and, more recently, LeClairRyan.
The law firm for which Matson had worked for for many years fell into bankruptcy in September 2019. That case continues to play out, with the trustee going after many of the firm’s former attorneys, including Matson. The trustee recently won a bid to keep the terms of a settlement reached with Matson confidential, despite objections of one of the biggest creditors in the case.
Bruce Matson is a former LeClairRyan attorney who was disbarred last year. (BizSense file)
Bruce Matson, a veteran Richmond attorney who was disbarred last year for his mishandling of millions of dollars in a major bankruptcy case, has been charged criminally by federal prosecutors.
The U.S. Attorney’s Office on Thursday hit Matson with one count of obstruction of an official proceeding related to his work as the trustee overseeing the bankruptcy of collapsed Henrico-based title insurance giant LandAmerica while he was employed at law firm LeClairRyan.
The brief two-page filing states that Matson “did corruptly influence, obstruct and impede, and endeavor to influence, obstruct and impede, the due and proper administration of the law under which a pending proceeding was being had before an agency of the United States, that is the United States Trustee Program.”
The U.S. Trustee Program is a component of the Department of Justice.
Matson was charged via the criminal information process, which does not require a grand jury indictment and typically involves cooperation from the defendant. Matson was not arrested as part of the charges.
He remains free at least until his initial court appearance at 10:30 a.m. July 22 before Magistrate Judge Mark Colombell. That proceeding will include a detention hearing. He’ll then immediately go before Judge John Gibney for arraignment and a plea agreement hearing.
A summons issued in the case indicates that Matson intends to plead guilty.
Matson is represented in the criminal matter by McGuireWoods attorney Brandon Santos, who declined to comment.
The filing claims the alleged obstruction took place over the course of Aug. 25-Nov. 25, 2019, but no further detail of the offense is included.
The charge comes more than a year after it was brought to light in bankruptcy court that Matson wrongfully withdrew nearly $3 million from the LandAmerica wind-down account and deposited it into his personal bank accounts and that of an associate.
Matson, who spent much of his 40-year law career as a bankruptcy trustee, oversaw the complex LandAmerica case from the time of the Henrico-based title insurance giant’s collapse in 2008 until its seemingly successful conclusion in 2015.
But in August 2019, it was discovered that the wind-down fund had been emptied. Those funds were not to be disbursed until the wind-down period came to a close in 2021.
Matson eventually admitted to taking the money out of the trustee account and was removed as trustee from the LandAmerica case, despite his objections. He has since repaid the funds back to the estate and was also disbarred by the Virginia State Bar, effectively ending his career in law.
He also recently paid an additional $577,000 to the LandAmerica estate for reasons that were not explained in bankruptcy court filings.
The missing trust account funds were discovered by Protiviti, which works as a financial advisor on bankruptcy cases, including those of LandAmerica and, more recently, LeClairRyan.
The law firm for which Matson had worked for for many years fell into bankruptcy in September 2019. That case continues to play out, with the trustee going after many of the firm’s former attorneys, including Matson. The trustee recently won a bid to keep the terms of a settlement reached with Matson confidential, despite objections of one of the biggest creditors in the case.
Wasn’t he just keeping that money in his personal bank account as a “courtesy” to his client since it was a holiday weekend?
Maybe he can request to do his own sentencing or his own jury.
Well it is a felony and the max sentence is up to 10 years. I am sure he will get 18 months.
Bruce Matson has:
-been humiliated in his community
-been disgraced among his (attorney) peers
-been disbarred
-repaid funds he misappropriated
-(apparently) agreed to plead guilty to criminal charges
-had his life pretty much ruined, through his own actions
-not carried on as if he is an innocent victim
And he will now have a felony conviction on his recored which will bar him from seeking to practice his profession in the future. Yet, some believe that society will benefit by locking Mr. Matson in a cage. Perhaps we should bring back the guillotine?!
Meanwhile we live in a society where if you are a blue collar criminal you deserve to be in jail forever.
Enough with the sympathy and leniency for white collar criminals.
The guy is a scumbag and a thief, and as a TRUSTEE he has to be held to at the minimum a higher standard than a non-trustee attorney. Hopefully he goes to a real prison and has real prison stuff happen to him.
LOCK HIM UP!!!!
The Justice system works in strange ways. Let’s just be real with the reality.
What about his associate? Or, is it accomplice? Does Robert Smith get to walk away after the funds also wound up in a joint account he shared with his wife?
From Bizsense on 12/03/19:
With two years left in the prescribed six-year wind-down period and $2.8 million still remaining in the account, court records show that it was discovered in August that the money had been removed from the account and split into personal accounts of Matson and his associate Robert Smith, and their wives.
https://richmondbizsense.com/2019/12/03/landamerica-bankruptcy-case-resurrected-after-concerns-over-leftover-funds/