A White Plains lawyer who practiced for roughly 60 years has been suspended from the bar for three years after a New York appellate court found he abdicated his duty to oversee his firm's attorney trust account, which came up about $290,402.47 short of what it should have held. The New York Supreme Court, Appellate Division, Second Judicial Department ordered that Stephen Holden's suspension take effect on October 30, 2026, and barred him from applying for reinstatement before April 30, 2029.
The court's decision, detailed by the New York State Law Reporting Bureau, granted in part a motion from the Grievance Committee for the Ninth Judicial District, which had brought six professional misconduct charges against Holden. The panel ultimately sustained three of those charges — one, four, and five — while dismissing charges two, three, and six as not sustained. Charge one alleged misappropriation of trust account funds tied to a client matter known as Surace, citing Rule 1.15(a) of the Rules of Professional Conduct, while charge four alleged Holden failed to properly manage and supervise the trust account, citing Rule 8.4(h) for conduct adversely reflecting on fitness as a lawyer.
A Trust Account Hundreds of Thousands of Dollars Short
Charge five centered on the misappropriation of funds belonging to the Margaret E. Sackett Trust. According to the Law Reporting Bureau's account, the trust account should have held $519,324.22 as of September 1, 2017, but was instead short by about $290,402.47 on that date. Separately, a $100,000 check payable to attorney Lawrence Bellom bounced for insufficient funds in March 2018, following deposits of $16,250 in December 2017 and $83,750 in January 2018.
As reported by ALABnews, the Sackett Trust and Masonic Guild funds were placed into the firm's account by Holden's cousin and law partner, James Holden Jr., who was also a signatory on the account. James Holden Jr. used those funds to make loans, including loans to himself, the outlet reported. Law firm records examined during the investigation showed unmonitored loans drawn from the trust account ranging from $20,000 to $100,000, with only a portion ever repaid, according to the Law Reporting Bureau.
A Bookkeeper, a Software Switch, and a Bounced Check
Holden told the court the Surace and Sackett matters belonged to his cousin and said he only learned of the account problems after the dishonored check surfaced, per the ALABnews account. He acknowledged he should have done more to oversee the firm's bookkeeper and reconcile the escrow accounts. In defense statements described by FindLaw, Holden attributed some of the record-keeping failures to the firm's transition to computerized accounting software, which he said caused the firm's nonagenarian bookkeeper to fall behind updating client ledgers.
Holden deposited $6,000 and then $60,000 of his own money to cover shortfalls, while James Holden Jr. contributed about $163,000, the outlet's reporting states. A separate client matter involving $60,500 deposited into the firm's master account on behalf of a client named Brailey was paid out from the trust account, with the discrepancy corrected roughly five years later. Holden also could not account for $62,966.75 of the $125,466.75 that was in the master account, according to the same reporting.
Referee Recommended No Punishment, Appellate Court Disagreed
The case had a long path through the disciplinary system. Special Referee Sondra M. Miller heard the matter in March 2023 and sustained all six original charges but recommended no additional punishment. The Appellate Division rejected that sanction recommendation outright, and it also rejected the referee's decision to admit an affidavit from James Holden Jr. and the referee's finding that Holden had no prior disciplinary history.
On that last point, the committee reported that Holden's record actually includes a 2023 letter of advisement, a 2012 admonition, and letters of caution dating back to 1987 and 1976 — though none of those earlier matters involved escrow management, per the committee's account. The court ultimately found that Holden abdicated his fiduciary duties, went years without reconciling the firm's accounts, and ignored warning signs, even as it weighed his community service, remedial steps, remorse, cooperation, and character evidence.
Holden presented character testimony from four witnesses during the proceeding and pointed to decades of civic leadership in White Plains and Westchester County, including service with the White Plains and Westchester Bar Associations, the Rotary Club of White Plains, and the Salvation Army, along with commendations from the New York State Senate and a U.S. congresswoman, according to the Law Reporting Bureau. Holden was represented in the disciplinary matter by Scarsdale-based attorney Deborah A. Scalise of Scalise & Hamilton, P.C., while the Grievance Committee was represented by Courtny Osterling and Antonia Cipollone. The case is formally titled Matter of Stephen Holden, Docket No. 2020-01182.
What the Suspension Means Going Forward
Under New York Judiciary Law § 90, Holden is now strictly barred from practicing law in any form during his suspension — he cannot appear before courts or public bodies, give legal opinions, or hold himself out as an attorney, per FindLaw's summary of the statute. The Grievance Committee for the Ninth Judicial District, based in White Plains, holds disciplinary jurisdiction over attorneys across five Hudson Valley counties: Westchester, Rockland, Orange, Putnam, and Dutchess, according to the New York State Unified Court System.
Holden, who according to Avvo practices elder law in White Plains, graduated from Cornell Law School in 1964 and obtained his New York law license in 1965, practicing with the family firm Holden Brothers, P.C. for roughly 60 years. His case lands amid broader scrutiny of attorney trust account oversight statewide. New York Rule of Professional Conduct 1.15 imposes strict fiduciary obligations on lawyers handling client funds, barring commingling and requiring detailed account records, check registers, and client ledgers to be kept for seven years, according to Irvine Bookkeeping. A 2025 report by the New York City Bar Association found that real estate escrow losses accounted for $9.9 million of the $11.6 million reimbursed to clients in 2024 by the New York Lawyers' Fund for Client Protection.
