CLIENTS’ SECURITY BOARD

CLIENTS’ SECURITY BOARDof the Supreme Judicial Court of Massachusetts

August 31, 2018Dear Reader,

After dipping below the $1 million mark in annual awards for two consecutive years, the Board awarded $1.29 million to 91 claimants in fiscal year 2018. That marked the 24th year (out of 44 years in existence) when total awards exceeded $1 million.

Disbarred lawyer David Zak, accounted for 52 of the 91 awards, for a total of $261,524.00 paid to his former clients. Using radio and newspaper advertisements, he methodically exploited Spanish and Portuguese-speaking homeowners with false claims about his prowess in obtaining mortgage modifications for those affected by the 2008 real estate crisis. He then proceeded to charge thousands of dollars in advance fees for his services. Not only did he fail to provide legitimate legal services — barely 5% of his clients’ mortgages were permanently modified — but his charging of advance fees itself was unlawful under state and federal regulations, Attorney General Healey vigorously pursued a Chapter 93A action against him but Mr. Zak’s bankruptcy thwarted attempts to execute on that judgment. The result was a settlement covering less than 10% of Mr. Zak’s defalcation. On bar counsel’s suggestion, the Board contacted AAG Sara Cable who graciously shared the litigation documentation on Mr. Zak’s former clients that were the basis of the Chapter 93A action. Using these materials, the Clients’ Security Board made 52 awards to Mr. Zak’s former clients. As a result of those awards and outreach by the Board, additional, heretofore unknown, former clients of Mr. Zak filed claims and received CSB awards. This is a sterling example of cooperation with other agencies that helped to restore trust in our profession and to provide full restitution to victims of lawyer fraud.

This is my fourth and final letter as Chair. In those four years, our Board awarded a total of $5.6 million that included $2.9 million in 2015 (highest in Board history) and $500,701 last year (lowest in 30 years). Even with those steep fluctuations, the last eleven years show a median annual award of $2,059,195. This microcosm of Board history underscores both the inherently unpredictable nature of our work in any one year, and its consistency over many years.

Serving on the Board has been one of the most rewarding experiences of my professional career, as such service brings with it rich human interaction and the ability to help right the wrongs done to the public. This limited space prevents me from naming individuals, but I have never worked with a more dedicated, insightful group than my colleagues on the Board who always strove to make the right decisions. It was the claimants who appeared before us, however, who left a permanent marker in my memory. Their shock at betrayal and their abiding gratitude to the lawyers of Massachusetts for restoring the stolen dollars made it supremely worthwhile.

The existence of and the work done by the Board would not be possible without the commitment to justice of the Supreme Judicial Court. The Court’s foresight in establishing a client protection protocol that has neither a statute of limitations nor a cap on awards has made the Board the gold standard of client protection agencies nationwide. On behalf of the Board, I reaffirm the Board’s gratitude for the decades of unwavering support from the Supreme Judicial Court.

Finally, I must recognize Karen O’Toole, Adam Lutynski and Bernice Addonizio, without whose intelligence, hard work and, perhaps most importantly, compassion for those wronged, the Board could not function. It has been my honor to work with them over the years.

Very truly yours,

D. Ethan JefferyChair

Annual Report Fiscal 2018

2

FY 18 – Significant Numbers

Total Awarded

$1,297,094

Claims Adjudicated

101

Total Awards

91

Lawyers Responsible

22 out of 59,193

(0.04%)

# Claims Pending, Year-End

50

$ Claims Pending, Year-End

$3,379,142

Clients’ Security Fund Balances1 - FY2018

Fund as of 08/31/17 $7,571,473

Allocation for FY18 $428,526

Fund as of 08/31/18 $6,702,905

1 Reflect FY18 fluctuations in market value of investment portfolio (specified in CSB Rule 4) plus increases from interest and restitution payments minus decreases from payments of awards.


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Claims Activity Chart 1975-2018

FY 18 – Significant Numbers

Total Awarded

$1,297,094

Claims Adjudicated

101

Total Awards

91

Lawyers Responsible

22 out of 59,193

(0.04%)

# Claims Pending, Year-End

50

$ Claims Pending, Year-End

$3,379,142

FiscalYear

Claims Filed

Claims Adjudicated

Claims Dismissed

AwardsMade

TotalAwards

1975-1979 195 126 76 50 $148,767.80 1980 126 60 38 22 $71,208.00 1981 42 126 61 65 $244,276.18 1982 30 29 9 20 $80,212.00 1983 35 40 7 33 $152,005.00 1984 45 42 17 25 $141,125.67 1985 46 34 12 22 $224,904.17 1986 23 38 7 31 $214,810.75 1987 42 34 12 22 $503,776.00 1988 28 24 13 11 $267,954.24 1989 51 40 16 24 $146,720.06 1990 74 73 18 55 $759,025.23 1991 71 55 20 35 $624,592.42 1992 124 85 16 69 $968,894.77 1993 146 95 22 73 $1,111,181.93 1994 109 157 27 130 $1,203,911.62 1995 90 103 35 68 $1,602,217.70 1996 139 100 33 67 $1,696,870.13 1997 81 113 30 83 $2,058,900.92 1998 119 102 46 56 $1,254,229.91 1999 80 98 32 66 $2,119,675.47 2000 83 108 22 86 $2,744,848.83 2001 119 70 15 55 $1,963,555.27 2002 82 94 25 69 $1,066,379.91 2003 116 56 11 45 $1,055,477.00 2004 90 157 58 99 $2,412,597.49 2005 81 81 26 55 $2,203,527.19 2006 91 93 51 42 $1,653,026.91 2007 77 88 31 57 $1,958,904.76 2008 108 89 21 68 $2,654,436.60 2009 95 116 33 83 $1,328,039.01 2010 82 106 14 92 $2,397,677.77 2011 106 97 34 63 $2,059,194.55 2012 85 113 27 86 $2,111,791.36 2013 108 83 14 69 $2,801,665.59 2014 121 142 28 114 $1,324,815.87 2015 59 86 25 61 $2,949,085.20 2016 47 50 22 28 $846,842.96 2017 68 62 15 47 $500,701.48 2018 95 101 10 91 $1,297,094.04

TOTAL 2,337 $50,924,921.76


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Defalcations & Awards by Disciplined/Deceased Lawyers

* Deceased

Disciplined Lawyer Town CountyNo. of

AwardsAmountAwarded

Defalcation Amounts

Paul C. Dick Amesbury Essex 2 $309,800.00 $309,800.00

David Zak Cambridge Middlesex 52 $261,524.00 $261,524.00

John F. Paczkowski Dracut Middlesex 1 $215,939.84 $215,939.84

Frederick B. Hayes, III Boston Suffolk 1 $210,770.00 $210,770.00

Douglas W. Resnick Hopkinton Middlesex 1 $42,000.00 $42,000.00

Ezenwa L. Nwogu Revere Suffolk 3 $39,762.22 $39,762.22

Ross A. Annenberg Hopkinton Middlesex 1 $31,250.00 $31,250.00

Glen R. Vasa Brockton Plymouth 7 $69,270.13 $69,270.13

Jeffrey R. Mazer Ipswich Essex 7 $27,800.00 $27,800.00

Francis M. O’Boy* Taunton Bristol 1 $19,050.00 $19,050.00

Philip Morgan Markella Plymouth Plymouth 2 $17,938.72 $17,938.72

Deborah Ann Anthony Methuen Essex 1 $12,996.48 $12,996.48

Robert W. Landry* Sudbury Middlesex 1 $8,150.65 $8,150.65

Ronald L. Brandt W. Newton Middlesex 1 $7,500.00 $7,500.00

Laird James Heal Winchendon Worcester 1 $4,800.00 $4,800.00

Rosaleen J. Clayton Auburn Worcester 1 $4,342.00 $4,342.00

Mark Eric Robinson Scituate Plymouth 1 $4,250.00 $4,250.00

Mary E. Bono Norton Bristol 2 $3,050.00 $3,050.00

Yuri Levintoff Newton Middlesex 1 $3,000.00 $3,000.00

Kristin A. Brassard Fitchburg Worcester 1 $1,500.00 $1,500.00

Mark A. Giarrusso* Kingston Plymouth 1 $1,400.00 $1,400.00

Robert S. Messinger Lynn Essex 2 $1,000.00 $1,000.00

TOTAL 91 $1,297,094.04 $1,297,094.04


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* Deceased

FIDUCIARY: THE MISUSE OF FUNDS HELD BY AN ATTORNEY ACTING AS A FIDUCIARY ARISING FROM AN ATTORNEY-CLIENT RELATIONSHIP.

Disciplined Lawyer No. of

AwardsTotal

Awards % of TotalAwarded

Deborah Ann Anthony 1 $12,996.48 100.00%

Total 1 $12,996.48 100.00%

REAL ESTATE: MISAPPROPRIATION OF DEPOSITS, ESCROWS, PURCHASE MONEY OR SALE PROCEEDS IN PURCHASE, SALE, AND RE-FINANCE TRANSACTIONS.


AwardsTotal

Awards % of Total Awarded

Frederick Hayes, III 1 $210,770.00 75.79%

Robert Landry* 1 $8,150.65 2.93%

Philip Morgan Markella 1 $12,938.72 4.65%

Douglas Resnick 1 $42,000.00 15.10%

Mark Eric Robinson 1 $4,250.00 1.53%

Total 5 $278,109.37 100.00%

SETTLEMENT: MISAPPROPRIATION OF PROCEEDS FROM THE SETTLEMENT OF NON-PERSONAL INJURY LITIGATION MATTERS.


Awards Total


Ezenwa Nwogu 1 $2,000.00 100.00%

Total 1 $2,000.00 100.00%

PERSONAL INJURY SETTLEMENT: MISAPPROPRIATION OF PROCEEDS FROM THE SETTLEMENT OF PERSONAL INJURY MATTERS.


AwardsTotal


Ross Annenberg 1 $31,250.00 22.37%

Mark Giarrusso* 1 $1,400.00 1.00%

Ezenwa Nwogu 2 $37,762.22 27.03%

Glen R. Vasa 7 $69,270.13 49.59%

Total 11 $139,682.35 100.00%

TRUSTS AND ESTATES: THE MISAPPROPRIATION OF ASSETS FROM A TRUST, AN ESTATE, OR THEIR RESPECTIVE BENEFICIARIES BY AN ATTORNEY ACTING AS AN ATTORNEY OR AS A FIDUCIARY, EXECUTOR OR TRUSTEE.


Awards Total


Paul C. Dick 1 $260,000.00 54.63%

John Paczkowski 1 $215,939.84 45.37%

Total 2 $475,939.84 100.00%

UNEARNED RETAINER: CLIENT MONEY ACCEPTED BY AN ATTORNEY WHO FAILED TO PERFORM THE AGREED UPON LEGAL SERVICE. THESE CLAIMS SHOULD NOT BE CONFUSED WITH FEE DISPUTES OR MALPRACTICE CLAIMS WHERE AN ATTORNEY NEGLIGENTLY PERFORMS LEGAL SERVICES CAUSING FINANCIAL LOSS TO A CLIENT.


AwardsTotal


Mary Bono 2 $3,050.00 0.79%

Ronald Brandt 1 $7,500.00 1.93%

Kristin Brassard 1 $1,500.00 0.39%

Rosaleen J. Clayton 1 $4,342.00 1.12%

Laird James Heal 1 $4,800.00 1.24%

Yuri Levintoff 1 $3,000.00 0.77%

Philip Morgan Markella 1 $5,000.00 1.29%

Jeffrey Mazer 7 $27,800.00 7.16%

Robert Messinger 2 $1,000.00 0.26%

Francis O’Boy* 1 $19,050.00 1.74%

Paul Dick 1 $49,800.00 1.00%

David Zak 52 $261,524.00 67.34%

Total 71 $388,366.00 100.00%


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Lawyers with Highest Defalcations

Awards by Categories

CategoryNo. of

Awards% of Total Awards

TotalAwarded

% Total $$ Awarded

TotalDefalcation

% of Total Defalcation

Fiduciary 1 1.10% $12,996.48 1.00% $12,996.48 1.00%

Trusts and Estates 2 2.20% $475,939.84 36.69% $475,939.84 36.69%

Real Estate 5 5.49% $278,109.37 21.44% $278,109.37 21.44%

Unearned Retainer 71 78.02% $388,366.00 29.94% $388,366.00 29.94%

Settlement 1 1.10% $2,000.00 0.15% $2,000.00 0.15%

Personal Injury Settlement 11 12.09% $139,682.35 10.77% $139,682.35 10.77%

Total 91 100.00% $1,297,094.04 100.00% $1,297,094.04 100.00%

Paul C. Dick$309,800.00

24%

David Zak$261,524.00

20% John F. Paczkowski$215,939.84

17%

Lawyers with Highest Defalcations

Others$509,830.20

39%


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Information on filing a claim for reimbursement can be found atwww.masscsb.org

orcontact the

Clients’ Security Board99 High Street, 2nd Floor

Boston, MA 02110Telephone: 617-728-8700

Fax: 617-482-8000

RESTITUTION

Category Amount CollectedCourt Ordered $15,446.39

CSB Activity $1,200.00

Voluntary $5,000.00

Total $21,646.39

BASIS FOR DISMISSED CLAIMS

Category No. of Claims

No Defalcation 7

Restitution 3

Total 10

CLAIMS PENDING

Basis# of Claims

Pending $ Total Claims

Real Estate 4 $257,074.60

Settlement 3 $178,500.00

Trusts & Estates 6 $788,988.90

Unearned Retainer 31 $1,232,992.61

Investments 1 $654,000.00

Fiduciary 2 $205,000.00

Personal InjurySettlement 3 $62,585.93

Total 50 $3,379,142.04


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Board Members

D. Ethan Jeffery, Esq.,Chair, was appointed to the Board on January 1, 2011. He is a shareholder in the law firm of Murphy & King, P.C. where his practice focuses on representing debtors, trustees, and creditors in complex Chapter 11 cases, and representing debtors and creditors in non-bankruptcy restructurings and workouts. Mr. Jeffery received a B.A. from the University of New Hampshire and a J.D. from Villanova Law School. Mr. Jeffery is a member of the American Bankruptcy Institute’s Executive Advisory Board for the Northeast Conference, is the co-chair of the Boston Bar Association’s Commercial Finance Committee, and is listed in Chambers USA: America’s Leading Lawyers for Business.

Martin J. Newhouse, Esq., Treasurer, was appointed to the Board effective December 1, 2013. Mr. Newhouse is President of the New England Legal Foundation. Founded in 1977, NELF is a public interest nonprofit and nonpartisan courtroom advocate for the New England business community, as well as a resource on important business law and property rights issues. Prior to joining NELF in 2004, Mr. Newhouse had a twenty-year legal career at Ropes & Gray LLP, where he was a partner in the Litigation Department, chair of the firm’s pro bono committee, and advised the firm on legal ethics. As President of NELF, Mr. Newhouse oversees a legal staff that is active in appellate litigation throughout New England and the rest of the country, filing amicus briefs in both state and federal courts, including the United States Supreme Court, in business and property rights cases. Mr. Newhouse served as a Hearing Officer for the Massachusetts Board of Bar Overseers from 2003-2009, is a member of the Boston Bar Association’s Ethics Committee, and teaches Professional Responsibility at Suffolk University Law School. Mr.

Newhouse received an A.B. in economics from Columbia College, a Ph.D. in modern European history from Columbia University, and a J.D. from Yale Law School. In addition to his legal activities, Mr. Newhouse is on the Advisory Boards of the Massachusetts Foundation for the Humanities and the Winchester Community Music School, and has published on a variety of subjects from the philosopher Friedrich Nietzsche to current legal issues.

W. Lee H. Dunham, Esq., was appointed to the Board effective January 1, 2015. He is a retired partner of Sullivan & Worcester LLP and practiced corporate and securities law. Mr. Dunham served as managing partner of the firm from 1996 to 2002. He has served on the Board of Bar Overseers and was Chair from 2013 to 2014. He has also served as Co-Chair of the Boston Bar Association Senior Lawyers Section and as a Director of Greater Boston Legal Services and received its Southgate Volunteer Award. Mr. Dunham received a B.A. from Harvard College and a J.D. from Yale Law School.

Judi Goldberg, Esq., Secretary, was appointed to the Board effective January 1, 2015. She is a Senior Policy Analyst in the Massachusetts Office of the Inspector General. She has also worked as a litigation associate at McDermott, Will and Emery, Deputy General Counsel in Governor Romney’s Legal Office, Deputy General Counsel for the Executive Office of Health and Human Services, and as in-house counsel at Five Star Quality Care, Inc., a publicly-traded company that manages senior living facilities across the country. Ms. Goldberg earned a B.A. in psychology and sociology from Boston University, an Ed.M. from Harvard University in counseling processes, and a J.D. from Boston University where she was the managing editor of the Law Review.


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Board Members

Regina Snow Mandl, Esq., was appointed to the Board effective March 1, 2017. She is a partner at The Wagner Law Group and is head of the Lincoln office. Ms. Mandl specializes in family law, estate planning and administration, and probate litigation. Ms. Mandl received her BA, cum laude from New York University where she was elected to Phi Beta Kappa, and her J.D. from Boston College Law School. Ms. Mandl’s professional activities include the American Inns of Court, where she served on the Executive Committee and member of the Board of the American Inns of Court Foundation in Washington, D.C., and as past president of the Massachusetts Probate and Family American Inn of Court. She also serves on the Board of the New York University Lawyer Alumni Mentoring Program. Ms. Mandl was a two-term hearing officer for the Massachusetts Board of Bar Oversears. Recognitions include Massachusetts Lawyers Weekly Top Women of Law in 2014, and inclusion in SuperLawyers.

David R. Chenelle, Esq., was appointed to the Board effective June, 2018. He is the Director of Perkins & Anctil, P.C., located in Westford, MA where he manages the firm’s Condominium Lien Enforcement and Bankruptcy departments. He also works closely with the firm’s Community Association clients providing guidance and representation for lien enforcement and general matters. He is an active member of the CAI New England (CAI-NE) chapter participating in its attorneys’ committee. He is a strong advocate for his clients and specializes in the representation of consumer, commercial and business clients in all aspects of the bankruptcy process. He is an active member of the Massachusetts Bar Association; New Hampshire Bar Association; Co-Chair of the Worcester Bar Association’s Bankruptcy Section; a member of the Local Rules Committee for the U.S. Bankruptcy Court, District of Massachusetts; the National Association of Consumer Bankruptcy Attorneys (NACBA); the American Bankruptcy Institute (ABI) for which he is a frequent speaker; and has been appointed by the Supreme Judicial Court as a

Commissioner in an Attorney Suspension case. Mr. Chenelle received his BS from Lowell Technological Institute; MBA from UNH, and his JD from the Massachusetts School of Law. In his earlier professional career, Attorney Chenelle spent 14 years in the manufacturing industry working as an engineer and manager for various defense contractors.

Steven B. Stein, Esq. was appointed to the Board effective June, 2018. He is the managing counsel of the Travelers Indemnity Company staff counsel offices in Massachusetts and Rhode Island where he concentrates on handling subrogation matters including property, automobile, workers’ compensation and bond cases. Prior to becoming managing counsel he served as associate managing counsel, practice group leader and senior counsel. Before joining Travelers, he was employed in private practice at Batty & Stein. Mr. Stein received his B.A. degree in History and Economics from State University of New York at Binghamton in 1979 and his J.D. from Boston University School of Law in 1982 where he was involved in the National Trial Competition. He is admitted to practice in Massachusetts, Rhode Island and Florida. He served for many years as a Boston Municipal Court Pre-Trial case conference volunteer and is a Massachusetts Bar Association Legal Fee Arbitration Board Arbitrator, and former chair and board member.


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Peter H. Sutton, Boston1998 Recipient

Nathan H. Proctor, Oxford1999 Recipient

Charles F. Proctor, Oxford1999 Recipient

Thomas G. Hoffman, Boston2000 Recipient

Douglas W. Salvesen, Boston2002 Recipient

Jerry Cohen, Boston2003 Recipient

William J. LeDoux(1931-1999)

William J. LeDoux served as a member of the Board from 1987 to 1997, including seven years as Chairman. He distinguished himself by tirelessly advancing the Board’s goals of serving the public. In 1997 the Board established this award to recognize a lawyer who has demonstrated extraordinary skill and perseverance in representing a claimant before the Board.

William J. LeDoux Award Recipients


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Laura Hancock Barry, Worcester2004 Recipient

Hung Tran, Boston2005 Recipient

Hang Nina T.K. Nguyen, Boston2005 Recipient

Russell S. Channen, Haverhill2010 Recipient

S. Peter Ziomek, Jr., Amherst2010 Recipient

Leonard A. Frisoli, Cambridge2012 Recipient

Timothy J. Perry, Boston2014 Recipient

Saman S. Wilcox, Worcester2018 Recipient


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PRO BONO LAWYERS

The Board is pleased to acknowledge and thank the following lawyers who generously contributed their time and talents during FY 2018 to represent claimants before the Board for which service, by Court Rule, they may not receive compensation.

John Bosk, Esq., Fitchburg, MA Nadine Cohen, Esq., Boston, MA

Benjamin D. Colten, Esq., Framingham, MA Elaine Andrea Godimis, Esq., Worcester, MA

Richard G. Grossack, Esq., Boston, MA David Hashey, Fredericton, New Bruinswick, CAN

Suzanne L. Herold, Esq., Charlestown, MA Daniel M. Hutton, Esq., Stoughton, MA

Douglas R. Hyne, Esq., Boston, MA Scott A. Lakin, Esq., Winchester, MA

James E. McCall, Esq., Boston, MA Lawrence J. Mullen, Esq., Andover, MA

James Ramsey, Esq., Worcester, MA Thomas J. Ryan, Esq., Marion, MA

Saman Salim Wilcox, Esq., Worcester, MA Abigail Williams, Esq., Worcester, MA


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CLIENTS’ SECURITY BOARD MEMBERSHIP 1974-PRESENT

GENERAL COUNSEL STAFFKAREN D. O’TOOLE

General CounselADAM M. LUTYNSKI

Deputy General CounselBERNICE ADDONIZIO

Legal Specialist

*Philip J. Assiran (1981-1983) Maria J. Krokidas (1979-1984)John G. Bagley (2013-2018) Elizabeth O’Neill LaStaiti (1982-1986)Joseph H. Baldiga (2012-2016) *William J. LeDoux (1987-1997)Thomas O. Bean (2005-2010) Edward J. Lee (1987-1992)George N. Beauregard (1982-1986) Amy S. Locke (2013-2018)*Barry D. Berkal (1981-1986) S. Thomas Martinelli (1975-1977) Mark N. Berman (1997-2002) Denzil D. McKenzie (2007-2013)Stanley B. Bernstein (1992-1996) Edward W. McIntyre (1999-2004)Mark I. Berson (1995-2000) *Stanley B. Milton (1974) David R. Chenelle (2018 - ) Francis C. Morrissey (2010-2014)Edward S. Cheng (2008–2013) Guy B. Moss (2002-2007)*Thomas H. Collins (1974-1981) Frederick L. Nagle, Jr. (1990-1995)J. Elizabeth Cremens (1987-1992) Martin J. Newhouse (2013 - )Judith A. Cross-Donahue (1988-1998) Loretta Sullivan O’Brien (1992–1997)Peter G. DeGelleke (2003-2008) Kathryn A. O’Leary (2004-2010)*Charles R. Desmarais (1974-1980) Thomas E. Peisch (1994-1999) Merrilynn R. Douglas (1989-1994) Michelle M. Porter (2010-2014)Patricia M. Dunbar (1997-1999) Dorothy G. Sanders (1992-1997)W. Lee H. Dunham (2015 - ) Mary H. Schmidt (1997-2002)John J. Egan (2007-2013) Edward D. Simsarian (1984-1989)Harrison A. Fitch (1986-1993) Thomas G. Sitzmann (1996-2001)John R. Gobel (2001-2006) Regina Snow Mandl (2017- )Charles W. Goddard (2007-2012) Steven B. Stein (2018 - )Judith Goldberg (2015 - ) Joseph D. Steinfield (1998-2003)Joel S. Greenberg (1980-1988) Peter H. Sutton (2000-2005)*Edward B. Hanify (1974-1979) Evelynne L. Swagerty (1999-2004)*Paul F. Hannah (1974-1976) *Berge C. Tashjian (1978-1980)Ruth-Arlene W. Howe (1983-1988) Charles Y. Wadsworth (1977-1982)D. Ethan Jeffery (2011- ) Lucy W. West (2002-2007)Raymond J. Kenney, Jr. (1979-1987) Pamela Jeanne Koehr (2004-2010) *Deceased

CLIENTS’ SECURITY BOARD

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