Christopher “Chris” Pettit, a San Antonio-based attorney accused of stealing millions of dollars from his clients, has surrendered his law license instead of facing disciplinary action from the State Bar of Texas. Pettit, who operated his primary law office on Rustic Lane in San Antonio and maintained another office on Huebner Road, has faced at least 14 lawsuits from clients alleging that he commingled accounts and stole their money. He served as legal counsel, investment advisor, trustee, and prepared tax returns for his clients.
Bankruptcy Petition Lists Millions in Assets and Debts
During a court hearing, Pettit’s lawyer explained that his focus before the bankruptcy was on securing a job in Florida, which he believed was available. Pettit is currently living in a mansion in the Disney World community of Golden Oak, which he originally claimed ownership of, but later amended his bankruptcy schedules to say it’s owned by an entity for the benefit of his son. Pettit is also claiming his home in Stone Oak as his homestead in the bankruptcy.
Several banks, including PNC Bank, Frost Bank, Broadway Bank, and Jefferson Bank, declined to do business with Pettit. IBC Bank allowed him to open an account but closed it two days later, charging a $25 fee for closing the account. The reason for the banks’ actions is unclear, but they are permitted to assess a customer’s character before entering into a business relationship.
Lawyer Denies Allegations
Pettit denied allegations in some complaints but entered into agreed judgments with a handful of clients, including punitive damages. The FBI has been investigating Pettit, and the Internal Revenue Service has launched its investigation. His alleged scheme culminated in him and his firm filing for Chapter 11 bankruptcy protection, with Pettit’s petition listing $27.8 million in assets and $115.2 million in debts.
Pettit’s assets include several homes, including a Disney World mansion valued at $8.9 million and a house in Alamo Heights valued at $3.6 million, along with two Porsches and two Mercedes-Benz vehicles. He filed a motion for the Supreme Court to accept his resignation without offering an explanation. The State Bar of Texas’ Office of the Chief Disciplinary Counsel cited four grievance complaints alleging Pettit’s professional misconduct, detailing one complaint where he was appointed a trustee for a doctor’s irrevocable trust and later transferred about $10.8 million to his and/or his law firm’s accounts.
Pettit falsely represented to the doctor that the money had been transferred to his Estate Management Account at Frost Bank, providing an altered statement that appeared to reflect a balance of over $12 million. The doctor’s funds were not in the account, and the money in it was far less than what was represented by the altered statement. Pettit paid back $8 million to the doctor and signed an agreed judgment that ordered him to pay the doctor about $2.9 million in actual damages and $8.6 million in punitive damages.
Supreme Court Lays Out Conditions for Reinstatement of Law License
The Supreme Court of Texas has laid out conditions for Pettit’s reinstatement of his law license, including making restitution to a couple in the amount of over $311,000 and paying the State Bar $2,500 to reimburse it for fees and expenses incurred during the investigation. Pettit’s bankruptcy petition lists about $106 million in unsecured claims, most held by his clients. He disputes all the unsecured claims. Pettit has already cancelled his law license, and he is required to notify his clients and judges handling his cases that he is no longer practicing law and return any files, papers, unearned monies, and any other client property.