Rhode Island court records describe millions advanced on scant paperwork, promised mortgages that were never recorded and financing charges exceeding 150 percent on a simple annualized basis; some of Dunbar’s former clients say they were victims, not conspirators

By Christopher Kelleher 

KENT COUNTY RI — Ronald W. Dunbar Jr. was no stranger to Brookfield. The Rhode Island attorney filed two lawsuits against the Town of Brookfield on behalf of clients and represented residents in other litigation, putting his name on some of the community’s most contentious legal disputes.

But when Dunbar died on July 28, he left behind another set of legal problems — this time involving his own financial dealings. A verified complaint filed in Kent County Superior Court accuses Dunbar and others of participating in a multimillion-dollar lending fraud involving short-term construction loans, anticipated personal-injury recoveries, personal guarantees and money moving through Dunbar Law PC’s client trust account.

The lender, Delman Coates, says he advanced at least $2.85 million through transactions proposed, structured and documented by Dunbar between December 2024 and April 2025. The allegations have not been proven in court. Dunbar died before the lawsuit was filed and cannot respond to them.

But the transactions described in the court record were extraordinary. A $900,000 construction advance was supposed to become $1.116 million roughly two months later. Another $450,000 was supposed to become $558,000 in approximately the same period. When one $624,960 obligation was extended for only three weeks, the additional charge was $56,250 — approximately 9 percent in 21 days, or about 156 percent on a simple annualized basis.

And despite millions purportedly being advanced for construction at The Orchard, a West Warwick condominium development belonging to a Dunbar client, Coates now alleges that the basic protections supposedly securing his money were never put in place: no promissory note was delivered, no mortgage securing Coates’s interest was recorded, and no financing statement was filed.

The lending nevertheless continued.

Now Coates is suing not only Dunbar’s law firm and the company associated with The Orchard, but several of Dunbar’s own former clients, accusing the defendants in one count of civil conspiracy. Some of those clients say they knew nothing about any broader lending scheme and regard themselves as victims of the attorney they trusted. They dispute Coates’s portrayal of them as participants and say they intend to seek review of Dunbar’s conduct by law-enforcement authorities, including the Attorney General.

The result is an unusual legal collision: A lender who says Dunbar victimized him is now suing people who say Dunbar victimized them, too.

Millions advanced on remarkably thin paperwork

At the center of the largest transactions was The Orchard condominium development in West Warwick. The development did not belong to Dunbar; it belonged to a client entity he represented. Yet Dunbar allegedly arranged three construction advances totaling $1.8 million purportedly for the development.

The first came on Dec. 18, 2024, when Coates advanced $900,000, with $1.116 million due approximately two months later. For a real-estate transaction approaching $1 million, the paperwork was notably spare: the agreement ran only two pages, with much of the second page devoted to signatures.

The agreement said Coates’s money would be secured by identified buildings at The Orchard. According to Coates’s complaint, that security was never put in place. Dunbar allegedly failed to deliver or record the promissory note, mortgage and financing statement that were supposed to protect Coates’s interest.

The complaint alleges that Dunbar nevertheless knew how conventional secured real-estate financing worked. Coates says Dunbar had previously handled institutional mortgage transactions involving the same development that included promissory notes, recorded mortgages and financing statements — protections Coates alleges were absent from his own loans.

The lending continued. On Feb. 26, 2025, Coates advanced another $450,000 for construction, with $558,000 due approximately two months later. Another $450,000 construction advance followed in April, bringing the three alleged construction advances to $1.8 million.

Coates describes those funds as construction money for The Orchard. But where the money actually went after it was advanced could become an important issue in the litigation. The court has made no factual finding that the full $1.8 million entered the development company’s accounts or was actually spent constructing condominium units.

$56,250 for 21 more days

As obligations reached maturity, the price of additional time could be enormous. One agreement stated that $624,960 was due March 19, 2025. The payment deadline was extended to April 9 — just 21 additional days — for a charge of $56,250, approximately 9 percent of the outstanding obligation for a three-week extension.

The agreement described the calculation directly: “That represents 12% per month but adjusted for a 3 week extension.” Annualizing the actual three-week charge on a simple, noncompounded basis produces a rate of approximately 156 percent per year. The agreement’s stated 12-percent monthly rate would equal 144 percent over 12 months on a simple basis.

The Brookfield Examiner is not characterizing the financing as unlawful. The applicability of lending and usury laws can depend upon the nature and structure of a particular commercial transaction. But whatever its ultimate legal status, the cost of the financing described in the documents was exceptional.

The Loans Kept Coming

The defaults did not stop the lending.

According to Coates’s complaint, however, the relationship between Coates and Dunbar did not begin with the Orchard or with the personal-injury clients who are now defendants in the lawsuit. Coates alleges that he had made loans through Dunbar before the transactions at issue in the case and that those earlier dealings helped establish a relationship of trust between the two men.

That history provides important context for what followed. According to Coates’s own account, Dunbar and Coates already had an established lending relationship before some of the clients now accused of participating in the alleged scheme became involved in the transactions described in the complaint.

As the later short-term obligations reached maturity without being paid, an unusual pattern emerged: extensions would follow, yet additional loans continued to be issued.

Rather than the flow of new money stopping when existing obligations went unpaid, the loans kept coming.

Coates alleges that Dunbar had gained his trust and repeatedly represented that repayment was forthcoming. But even as obligations arranged by Dunbar remained outstanding, Coates continued advancing additional money through new transactions.

That pattern continued until the lending relationship ultimately unraveled.

The lending reaches Dunbar’s personal-injury clients

The financing eventually extended beyond condominium construction and into another part of Dunbar’s practice: his personal-injury clients. In March 2025, Dunbar described two proposed transactions to Coates in an email as “60 day deals at the 10% per month that we have been doing on the personal injury claims.”

One transaction involved a $250,000 advance with $300,000 due approximately 60 days later. Another called for the same terms: $250,000 advanced and $300,000 repaid. An earlier personal-injury-related transaction involved $150,000 with $172,500 due, an obligation the complaint says was ultimately satisfied.

The agreements purported to use anticipated recoveries from Dunbar’s clients’ personal-injury cases as sources of repayment. According to Coates’s complaint, settlement recoveries in several matters were supposed to be routed through Dunbar Law PC’s IOLTA client trust account. Coates alleges that proceeds received through that account should have been preserved and delivered in accordance with the loan arrangements; alternatively, he alleges that some representations about settlements and checks may themselves have been false. Those allegations have not been adjudicated.

The court filings show how Dunbar’s lending arrangements allegedly became intertwined with his legal practice: property belonging to one client was identified in construction financing, while anticipated recoveries belonging to personal-injury clients were identified as sources of repayment in other loans.

From clients to alleged conspirators

One of the most consequential aspects of Coates’s lawsuit may ultimately be the identities of some of the people he sued: Dunbar’s former clients. In a civil-conspiracy count, Coates alleges that the defendants combined with Dunbar and others to obtain advances through false pretenses, structure unsecured transactions, divert proceeds and prevent Coates from protecting himself. The claim seeks to hold the defendants responsible for an alleged common scheme.

It is an allegation some former clients sharply dispute. Some say they had no knowledge of Dunbar’s broader financial dealings, never agreed to participate in a scheme and believe Dunbar used their legal matters in transactions they did not understand or authorize. They say they consider themselves victims and are preparing complaints asking government authorities, including the Attorney General, to examine Dunbar’s conduct. Those assertions have not been adjudicated either.

The competing accounts create a fundamental dispute at the heart of the case: Were Dunbar’s clients participants in his alleged scheme — or were their cases and assets being used as part of a scheme without their knowledge?

Public records raise questions about the lending

Coates’s complaint portrays him as relying heavily on Dunbar when making the loans. But the allegations also raise questions about the due diligence behind advances totaling millions of dollars.

Coates says Dunbar represented The Orchard as a 139-unit condominium development and made representations concerning how many units had been constructed and sold. His lawyers say a later examination of public records produced a different picture: the condominium declaration permitted no more than 108 units, municipal approval was for 107, and substantially fewer units had formally been declared when the lending began.

Coates says he relied on Dunbar’s representations. But the records his attorneys later examined were public, as were land records identifying ownership of the property. And according to Coates’s own lawsuit, no mortgage securing his construction advances was ever recorded.

Despite those circumstances, Coates says he ultimately advanced at least $2.85 million through the Dunbar-arranged transactions — and even that figure was incomplete when the complaint was filed because he was still reconstructing additional advances from his wire history.

$6.6 million in condominium sales

While Coates says his loans remained largely unpaid, The Orchard continued selling units. His court filings identify approximately $6.6 million in condominium sales, while Coates alleges that, apart from three later payments totaling $400,000, those sales did not satisfy what he says he was owed.

By the time Coates sought emergency court intervention, his attorneys said 49 of 53 units had been sold, leaving four units along with remaining land and development rights. That diminishing pool of property prompted Coates to ask the Superior Court to preserve what remained.

An $8.575 million buyer from across the country

As Coates pressed Dunbar for repayment, another purported solution emerged. According to the complaint, Dunbar provided Coates with a purchase-and-sale agreement showing White Lark Enterprises LLC, a Washington company, agreeing to purchase The Orchard for $8.575 million.

The proposed buyer was based in Port Townsend, Washington, roughly 3,000 miles from the Rhode Island development. Publicly available business records reviewed by the Examiner identify White Lark Enterprises as being associated with the coin-operated laundry and dry-cleaning business in Port Townsend. Other publicly available records reviewed by the Examiner indicate that a company by that name received a federal Paycheck Protection Program loan of approximately $40,000 during the pandemic.

Those records do not establish White Lark’s net worth, access to financing, investors or ability to acquire an $8.575 million property. But they present a notable contrast with the transaction Dunbar allegedly showed Coates: a Washington company publicly associated with a coin-operated laundry business purportedly preparing to purchase an entire Rhode Island condominium development for more than $8.5 million.

According to Coates, the sale never closed. His attorneys say they subsequently found no recorded deed or other instrument showing that the transaction had been completed. The complaint also alleges that the purchase-and-sale agreement was electronically signed by John DiMaggio as White Lark’s manager, while Washington Secretary of State records examined by Coates’s attorneys allegedly did not identify DiMaggio among the company’s registered agents or officers.

Coates alleges Dunbar nevertheless continued representing into 2026 that the closing was forthcoming and would provide the money necessary to repay him.

Dunbar’s alleged accounting: $4,442,877.18

By November 2025, according to the complaint, Dunbar himself prepared an accounting of amounts due across several transactions. The total was $4,442,877.18.

Coates says he subsequently received three payments totaling $400,000 and claims approximately $4.04 million remained outstanding under that accounting. The figure encompasses multiple transactions and is not simply the $1.8 million in principal Coates says he advanced for Orchard construction.

The complaint further alleges that in April 2026, after Coates indicated that he might hire an attorney, Dunbar said that if litigation were filed he would assert no defense to the amount owed and agree to immediate judgment. According to Coates, the promised payment did not occur. Dunbar died several months later.

‘Bernie Madoff of Rhode Island’

The Coates litigation may represent only one part of the scrutiny now surrounding Dunbar’s financial affairs. A New York attorney examining other Dunbar-related transactions has characterized the late lawyer as the “Bernie Madoff of Rhode Island.”

That characterization belongs to the attorney, not the court. No court has found that Dunbar operated a Ponzi scheme, and the Rhode Island litigation remains pending. What the filed court documents describe is already substantial: millions of dollars in short-term financing, extraordinary returns, personal guarantees, purported real-estate security that the lender says was never recorded, personal-injury recoveries and money intended to move through a lawyer’s client trust account.

Court delays hearing as Coates seeks more time

The dispute was scheduled to return to court on Aug. 20, when a judge was expected to consider Coates’s emergency requests for a preliminary injunction and prejudgment attachment involving the remaining Orchard property. According to the parties, Coates requested approximately two additional weeks because he was unable to travel from Kentucky to Rhode Island for the hearing, and the matter was continued until Sept. 2.

The delay also changed the temporary restrictions on the property. Following an Aug. 19 in-chambers telephone conference, Rhode Island Superior Court Associate Justice Richard Licht ordered the Aug. 11 temporary restraining order dissolved effective at 4 p.m. Aug. 20. In its place, the court imposed a narrower temporary restriction through Sept. 2.

Under the new order, the Orchard defendant must provide Coates at least 72 hours’ written notice before selling, conveying, transferring, contracting to sell, or placing a new mortgage or other encumbrance on the property. If Coates seeks court intervention during that period, the proposed transaction cannot proceed until the court rules on his request.

Importantly, Licht’s order was entered “without findings of fact” and expressly preserved the defendant’s claims and defenses. The court therefore has not determined that Coates is entitled to attach the Orchard property or that his underlying allegations are true.

The rescheduled hearing on Coates’s motions is set for Sept. 2 at 9:30 a.m. in Kent County Superior Court.