Chernushin's suicide doesn't stop bankruptcy action from moving forward 

Case continues

click to enlarge Chernushin faced criminal charges. - FILE PHOTO
  • File photo
  • Chernushin faced criminal charges.

Despite the suicide of disbarred attorney Gregory Chernushin last week, his bankruptcy will not be dismissed, the U.S. Bankruptcy Court trustee says.

"The case is just going to proceed as if the death didn't occur," trustee Robertson Cohen says. "The law is pretty clear on that. To the extent it's possible to move forward, we're going to move forward. If you look at the issues we've laid out in the case, the death doesn't change the facts of the case."

Chernushin, 64, who was disbarred last summer, faced six felony counts for stealing money from clients but had not been arrested before he shot and killed himself at a campground in southwest Colorado on June 8 or 9. A time of death was not established. His body was found about 8 a.m. on Thursday, June 9, near the entrance to the Target Tree Campground off U.S. Highway 160, about 26 miles west of Durango, says La Plata County Sheriff's Office public information officer Daniel Bender.

Bender says Chernushin's green 1995 Range Rover was parked there, and a letter and his driver's license were pinned to his clothing. The letter has not been released.

In an email to the Independent, La Plata Coroner Jann Smith says she ruled the death "suicide by a self-inflicted gun shot wound." A formal report takes about three to four weeks to compile, she said. The weapon was a Smith & Wesson .38 caliber handgun.

Chernushin was a well-known personal injury attorney in Colorado Springs for years. He admitted in a July 2015 disbarment stipulation to stealing $334,865 from four clients and a vendor and agreed to repay them. He filed for bankruptcy in August, initially trying to prevent his home on West Cheyenne Road from being sold. After an attorney representing one of his former clients who was bilked out of money cried foul, the bankruptcy was converted to a liquidation proceeding.

Chernushin listed roughly 40 clients to whom he potentially owed money, as well as $350,000 owed to the IRS. His debts totaled roughly $1.5 million, and his assets were said to be worth $850,000, including the Springs home and a condominium in Crested Butte. The home is for sale; the condo's status isn't clear, but Chernushin reportedly was living there.

On June 8, a day before his body was found, the Indy reported that the District Attorney's Office had filed four counts of felony theft and two counts of forgery, also felonies, against Chernushin on May 27, capping an investigation by the Colorado Springs Police Department that began in March 2015. Bond was set at $50,000.

Three of the four theft and forgery victims listed on the arrest affidavit were interviewed by the Indy for its cover story about Chernushin ("Betrayal of trust," Feb. 24). The fourth is listed in the disbarment admission of misconduct as being owed $60,246.

Contacted by the Indy by phone on June 7, Chernushin declined to comment on the charges or a recent bankruptcy filing against his wife, Andrea, which alleged she received assets from him that should have been made available to repay creditors.

Also reported by the Indy on June 8, the complaint filed by Cohen alleged Chernushin had transferred assets that are fair game for liquidation, including partial ownership of the West Cheyenne Road home, listed for sale at $613,000, insurance settlement funds and a court judgment for property damage from flooding, Chernushin's earnings and settlement funds belonging to his clients.

Cohen says he's "mindful of the emotional impact" of Chernushin's suicide, but notes, "Our duty is to the creditors, and it's going to keep moving forward."

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