A former Bend and Portland attorney who embezzled more than $1.1 million from clients was sentenced Monday to more than five years in federal prison and ordered to repay the money, prosecutors said.
US. District Judge Michael McShane sentenced Bryan Gruetter, 55, of Portland to 63 months in prison and ordered him to pay $1,144,487.97 in restitution.
According to court documents, Gruetter, a former personal injury lawyer, embezzled more than $1.1 million from his clients between 2008 and 2012.
Gruetter, an attorney licensed to practice law in Oregon, had offices in Portland and Bend, and primarily worked personal injury and wrongful death cases.
In 2012, law enforcement began investigating Gruetter’s use of his clients’ money and determined that between January 2008 and January 2012, he had illegally diverted more than $1.1 million of his clients’ money to pay for personal and business expenses rather than to pay the clients or to pay the clients’ legal, medical, insurance, or other associated costs.
When interviewed, prosecutors say Gruetter admitted that he was “robbing Peter to pay Paul” because his law firm’s monthly income was insufficient to cover the monthly overhead, which included personal family payments and expenses.
On March 9, 2012, Gruetter resigned his law license, deciding not to challenge the allegations.
Currently, the Oregon State Bar through the Client Security Fund has paid more than $900,000 to some of his clients in an attempt to mitigate some of the damage Gruetter caused.
In fact, the Gruetter claims exhausted the Client Security Fund reserves, requiring an increase in bar members’ annual assessments from $15 to $45 until the reserve is fully funded.
U. S. Attorney S. Amanda Marshall commented, “As a lawyer, this defendant had a solemn duty to help his clients seek justice. Instead, he betrayed their trust and victimized vulnerable individuals by lying to them and stealing their money."
"His conduct tarnishes a profession full of hard-working, ethical attorneys who work hard every day helping people solve complex problems. My office will not tolerate this type of behavior from professionals who violate the public's trust in this manner,” Marshall added.
The case was investigated by the FBI, the IRS, the Deschutes County District Attorney’s Office and the Bend Police Department and was prosecuted by Assistant U.S. Attorney Scott E. Bradford.