Missouri Supreme Court
JEFFERSON CITY — The Supreme Court of Missouri has indefinitely suspended an attorney’s law license after concluding he knowingly assisted a client in fraudulent transactions designed to reduce the marital estate during a contentious divorce, rejecting a joint recommendation that he receive only a public reprimand.
In an opinion issued Jan. 13, the court ruled that although Mark W. Arensberg and the Office of Chief Disciplinary Counsel agreed he acted negligently, the evidence showed he acted knowingly when he drafted and filed loan documents and security interests that were later found to be fraudulent.
The court ordered Arensberg suspended indefinitely, with no ability to apply for reinstatement for six months, but stayed the suspension pending his successful completion of a one-year probation period.
The disciplinary case arose from Arensberg’s work for a longtime client who sought to document and secure loans involving family-owned businesses while the client’s son was in the midst of a high-net-worth divorce.
Arensberg, a Missouri attorney licensed since 1990 with no prior disciplinary history, focused his practice on business transactions and did not represent any party in the divorce itself.
According to the court’s findings, Arensberg drafted a promissory note, security agreement and default notices that encumbered the son’s business interests during the divorce.
The circuit court handling the dissolution later found that the transactions were fraudulent and intended to diminish the marital estate, describing the conduct of the client and son as among the most egregious it had seen in more than a decade of domestic cases.
Although Arensberg did not appear as counsel or a witness in the divorce, the circuit court concluded he had a clear intent to create fraudulent documents.
The record showed that Arensberg was aware of the pending divorce and the potential that business interests could be considered marital property.
He repeatedly warned his client that adding collateral and backdating documents could expose the transactions to claims of fraudulent conveyance by the son’s spouse.
Despite those warnings, Arensberg prepared and filed documents securing a $900,000 loan with the son’s interest in a family-owned company and later drafted default notices for loans that had not been formally documented at the time.
Emails cited in the opinion reflected urgency from the client to finalize and register the documents quickly, with references to preventing the spouse from claiming the assets.
The court noted that Arensberg suggested setting effective dates to align with prior discovery responses in the divorce, a factor the circuit court later viewed as a strong indication of fraud.
When the spouse challenged the transactions as fraudulent conveyances and sought to join additional parties in the divorce, Arensberg acknowledged in writing that the transactions could be viewed as fraudulent or as attempts to reduce the value of marital assets.
The Supreme Court found this acknowledgment, combined with his repeated warnings and continued assistance, demonstrated conscious awareness of the fraudulent nature of the conduct.
The Office of Chief Disciplinary Counsel alleged Arensberg violated multiple rules of professional conduct, including assisting a client in fraud and failing to withdraw from representation that would violate ethical rules.
Although the disciplinary hearing panel accepted a joint stipulation that characterized his conduct as negligent and recommended a public reprimand, the Supreme Court noted that it is not bound by such stipulations and conducts its own de novo review.
In determining discipline, the court considered Arensberg’s mental state, the duties violated, and the actual and potential harm caused.
It found that his actions caused injury by increasing litigation and delaying resolution of a family law case involving minor children.
While acknowledging mitigating factors such as his lack of prior discipline, cooperation, and professional reputation, the court concluded those factors did not outweigh the seriousness of knowingly engaging in conduct prejudicial to the administration of justice.
The court ultimately imposed an indefinite suspension, stayed with probation, concluding Arensberg could be supervised and was unlikely to harm the public if he complied with the conditions imposed. All judges concurred in the decision.
Supreme Court of Missouri case number: SC101157
