Civil Jury Orders Lawyer To Cough Up $1.4 Million To Ex-Client For Misappropriating Over $300K Held In Escrow Account; Punitive Damages Remain To Be Determined

In Bridgeport, Connecticut, the Connecticut Post reports:

• [S]tratford lawyer Laurence Parnoff fell hard Monday [February 20] after a jury ordered him to pay $1.4 million to a Stratford woman for spending more than $300,000 of her money that he was holding in a special account.
  
  And it’s not over. A judge will now decide how much additional money Parnoff will be ordered to pay after the jury decided punitive damages should be ordered in the case.
  
  Parnoff did not return calls for comment.
  
  “My client was happy with the result, she felt the jury listened to her and paid attention to the relevant counts,” said New Haven lawyer Kenneth Rozich, who represented Darcy Yuille in the civil case.
  
  In December the state Supreme Court agreed with a lower court ruling that Parnoff should not be disbarred for his actions in the case holding that Parnoff did not willfully steal from Yuille. But after three hours of deliberation the six-member, Superior Court jury found that Parnoff committed civil theft through the “misappropriation,” of Yuille’s money.
  
  Judge Dale Radcliffe will hold a hearing on the punitive damages.
  
  Although Parnoff, who represented himself during the trial, is expected to appeal, the verdict appears to bring to an end 18 years of litigation on the case.
  
  In 1998 Yuille, then a nurse at Bridgeport Hospital, hired Parnoff to sue the hospital after she was fired after suffering a work-related injury.
  
  She signed an agreement to give him 40 percent of any money he won from the hospital but later learned the agreement Parnoff had her sign violated state law which caps contingency fees in civil cases at 33 percent, according to court papers.
  
  When the case was arbitrated for nearly $1.1 million, Yuille agreed to give Parnoff $125,000 instead of the nearly $440,000 his agreement called for with the remainder of the money - about $315,000 - put into an escrow account until the fee dispute could be settled.
  
  Parnoff subsequently sued Yuille and won a $252,000 jury award which was later overturned by the state Appellate Court. In the meantime, court papers state that Yuille learned that Parnoff had transferred all the $315,000 plus interest from the escrow account to his personal account and used all the money to pay his bills. She then sued him, claiming theft.

For more, see Stratford lawyer ordered to pay $1.4 million.

Another Attorney Gets Stripped Of Law License Over Alleged Misappropriation Of Over $65K In Client Funds

In Metairie, Louisiana, the Louisiana Record reports:

• The Louisiana Supreme Court ruled on Feb. 3 to disbar attorney Quenton I. White from the practice of law for alleged misappropriation of client funds and other violations.
  
  The order was decreed after approval of a petition filed by the Louisiana State Bar Office of Disciplinary Counsel.
  
  The ruling stemmed from misconduct charges brought against White in Tennessee, where he was also licensed to practice. According to Tennessee court documents, [... t]he collection of charges and violations stemmed from the mishandling [of funds] of five separate clients of which the attorney was ordered to pay restitution in the amounts of $16,666.67 and $50,000.(1)

For the story, see Attorney disbarred in Louisiana, Tennessee for misappropriating funds.

----------------------

(1) The Tennessee Lawyers’ Fund for Client Protection was established by the state Supreme Court to at least partially reimburse claimants for losses caused by dishonest conduct committed by lawyers duly licensed to practice in Tennessee.

In Louisiana, The Client Assistance Fund of the Louisiana State Bar Association was created to compensate clients who lose money due to the dishonest conduct by a lawyer licensed in the state. The Fund can reimburse clients up to $25,000 for thefts by a lawyer. It covers money or property lost because a lawyer was dishonest (not because the lawyer acted incompetently or failed to take certain action).

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (August 2016) (now includes Canadian recovery funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.

5+ Years After Fleecing Clients For Million$, Aging, & Now-Indigent & Disbarred Attorney Gets Six Years In Federal Prison

In San Jose, California, the Marin Independent Journal reports:

• A disbarred Marin lawyer who conned investors of more than $4.5 million was sentenced to six years in prison for securities fraud, federal authorities said.
  
  James Seltzer, 69, also accumulated more than $20 million in debts to other people, the prosecution said.
  
  “Seltzer perpetrated a brazen scheme of securities fraud against victims who knew him, trusted him, and in some cases, loved him,” Assistant U.S. Attorney Timothy Lucey wrote in a sentencing memorandum. “Rather than returning that trust and affection, Seltzer betrayed it, wielding it like a weapon to steal millions of dollars from investors in order to finance an extravagant lifestyle of decadence, debauchery, and deceit.”
  
  His public defender argued for a three-year sentence, citing Seltzer’s dire medical condition. He is a diabetic with congestive heart failure and kidney disease, said the public defender, Varell Fuller.
  
  “He comes before this court a ruined man, at the end of his life,” Fuller wrote in a sentencing memorandum. “He was once a respected lawyer with friends, family, and colleagues.
  
  “He has few friends or family. He finds himself living alone in a rented room imprisoned in a body racked with illness. His only income is Social Security.”
  
  Seltzer, who lived in Belvedere when the case unfolded, was indicted by a federal grand jury in 2015 on five counts of securities fraud, one count of mail fraud and three counts of money laundering. Federal authorities allege the crimes occurred between 2005 and 2011 and involved 16 victims.(1)
  
  Authorities said Seltzer solicited money from clients and their friends for sham investments in stocks or overseas real estate. He allegedly claimed that he had investment access to shares of private companies before they were publicly traded.
  
  Seltzer deposited the funds in personal bank accounts and used the money for expenses such as mortgage payments, credit card bills, travel or paying back earlier investors.
  
  “In some cases, Seltzer even entered into seemingly romantic relationships with several women in order to gain their trust and then rip them off,” Lucey wrote.
  
  In September, Seltzer accepted a plea deal and admitted to one count of securities fraud. He was sentenced Wednesday [February 15] by U.S. District Judge Lucy Koh in San Jose.
  
  Seltzer was ordered to surrender by April 19 to serve his sentence.
  
  Seltzer, who got his law license in 1972, was disbarred in California in July 2014 over allegations he misappropriated hundreds of thousands of dollars in client or settlement funds,(2) according to the state bar.

Source: Former Marin lawyer sentenced for $4.5M fraud series.

-------------------------

(1) He then fled the country and remained overseas for five years, according to the U.S. Attorney's office. See Former Securities Lawyer Sentenced To Six Years Of Imprisonment For Securities Fraud (Disbarred Marin attorney also ordered to pay more than $4.5 million in restitution to defrauded investors).

(2) The California State Bar's Client Security Fund is a public service of the California legal profession, intended to help protect consumers of legal services by alleviating losses resulting from the dishonest conduct of attorneys. The amount the fund may reimburse for theft committed by a California lawyer depends on when the loss occurred. A maximum of $50,000 is reimbursable if the loss occurred before January 1, 2009. A maximum of $100,000 is reimbursable if the loss occurred on or after January 1, 2009.

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (February 2017) (includes Canadian recovery funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.

Lack Of Criminal Prosecution For Canadian Lawyers Who Misappropriate Client Funds A Common Occurrence; Client Reimbursement Fund Coughs Up Almost All Of $960K Misappropriated By One Attorney

In Winnipeg, Maintoba, CBC News reports:

• The Law Society of Manitoba referred 10 cases involving lawyers who wrongly took money from clients to the Winnipeg Police Service over a six-year period, but not one resulted in criminal charges.
  
  All 10 lawyers were disbarred because of their conduct. In total, they misappropriated more than $1.9 million, in amounts ranging from $5,000 to nearly $1 million.
  
  The Winnipeg Police Service declined an interview.
  
  ***
  "The law society reported these matters to the police because it is our statutory responsibility under the provisions of the Legal Profession Act to report possible criminal activity," Law Society of Manitoba CEO Kris Dangerfield wrote to the CBC in an email.
  
  Howard Tennenhouse is among the disbarred lawyers the law society referred to police. He misappropriated $960,000 from 55 residential school survivors. Many of his clients were unaware of the misappropriation, the law society said.
  
  Law society records say Tennenhouse intimidated clients who complained to the law society about his conduct, lied about continuing to meet with clients after he was suspended and, in one case, walked into a bank with a client and instructed the client to take out a bank draft of $27,607.50, which Tennenhouse then deposited into an account in Tennenhouse's wife's name.
  
  In the end, Tennenhouse pleaded guilty to seven counts of professional misconduct and was disbarred in February 2012.
  
  The law society repaid the residential school survivors almost all of the nearly $1 million Tennenhouse had overcharged.(1) It later recouped those payments in full from Tennenhouse, the law society said.

For more, see 10 Manitoba lawyers misappropriated nearly $2M but face no criminal charges (Winnipeg Police Service won’t say why lawyers were never charged for their misconduct).

--------------------------

(1) The Law Society of Manitoba maintains a Reimbursement Claims Fund to repay people whose trust monies have been misappropriated by their lawyer. All members of the legal profession contribute to this fund. Contact the Law Society for further information on how to make a claim under this fund.

For "attorney ripoff reimbursement funds" that provide some reimbursement for losses suffered by clients due to the dishonest conduct of lawyers licensed in the other provinces throughout Canada or in the various states throughout the U.S., see:

• Directory Of Lawyers' Funds For Client Protection (February 2017) (includes a listing for Canadian client protection funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.

Town Buys Tax-Delinquent Mobile Home Park Out From Under 16 Lot-Leasing Homeowners, Then Flips Premises To Private Company While Giving The Mostly Poverty-Level Residents The Boot; Aging Structures Make Physical Relocation Costly, Prohibitive

In Hampton, South Carolina, The Hampton County Guardian reports:

• In a society where the procurement of money often trumps compassion and empathy, it may not come as a surprise that a group of 16 Hampton homeowners will be forced out of their homes due to a legitimate land purchase by the Town of Hampton.
  
  According to Hampton Mayor John Rhoden, the town obtained the deed to the L & L property, in Hampton, in December of 2016 through the Forfeited Land Commission. The property was purchased by the town during a delinquent tax sale for $16,928. According to several L & L residents, a plan to come together as a group and purchase the land was thwarted after the interested L & L homeowners were informed the land was no longer available for purchase around a year ago by officials handling the sale of the property.
  
  During recent town council meetings, council members have discussed the plight of the homeowners and voted to give the residents of the property an additional 30 days, in addition to the legally required 30 days, to vacate the property.
  
  ***
  When asked whether or not the town could or would assist the residents with their relocation, Mayor John Rhoden stated, “There has got to be an agency out there somewhere that can help them.” [...] Although he is empathetic to the unfortunate situation the residents have been placed, the sale of the property is strictly “business” and will end up being a positive project for the town, both financially and esthetically.
  
  Rhoden stated the L & L property has been an “eyesore” to nearby residents for many years and that “it’s an area that needs to be cleaned up.” He added that there have been more than 80 police calls in that area over the past three years.
  
  “We weren’t getting any taxes off of it,” Rhoden added.
  
  Residents of L & L acknowledge Hampton was not required to give them an additional 30 days to vacate the property, but wish the town would acknowledge a majority of the homeowners live at or below the poverty level and cannot afford to move their trailers, especially under what they see as extremely short notice.
  
  “I think that we should have been given at least six months to have them moved,” said resident Albert Housey. “I understand that a year might be unreasonable, but I think that the town should have given us at least six months to leave.”
  
  “They could have at least given us until tax time to leave,” said Natasha Thomas. “Most of us depend on our tax refund check to purchase big ticket items anyway and it is going to cost over $3,500 to move the trailer I paid $1,800 for a year ago.”
  
  The residents have been put in a difficult situation by the sale of the land. Several of the residents, including Thomas, spent their entire life savings to purchase their homes. Several L & L homeowners say the trailers might not seem valuable to some individuals, but to these homeowners, however, the homes meant freedom and hope for the future. For many, their dreams of independence will soon be toppled, just like their homes, when town-funded land clearing operations begin in the near future.
  
  Many stated they feel hopeless they have paid for their homes and have paid the taxes on the homes, but will now be forced to, in many cases, leave it all behind and take a loss on their purchases.
  
  “I was looking forward to being able to raise my [multiple] grandchildren right next door,” said Thomas. “We are more than just a trailer park. We are more than a community. We are a family.”

For more, see L & L residents seek compassion, new homes (16 homeowners and their children will be forced to leave their homes in the coming weeks if they cannot legally or monetarily afford to move their mobile homes to a new location).

See also:

Hampton reaches out to L & L residents:

• The Town of Hampton obtained the property, which was home to 16 households, for $16,928 from the Forfeited Land Commission during a December delinquent tax sale. The town then turned around and sold the property to a potential industry to be used to generate solar power. The residents there were then given a legally required 30 days to relocate.

Mobile home park residents in Hampton Co. could end up homeless after sale:

• “The only option for me right now is I have to start all over. Trying to get a mobile home, it’s like paying money. You're going to have to have rent, lights, water, food. It’s like starting all over," [one homeowner] said.
  
  ***
  One reason residents are having problems moving their mobile home is that in order to get a permit at a new lot, the home can not be more than 10 years old. Most of the mobile homes in question were built in the 80s..

Last Few Of Nearly 400 Recently-Booted Pittsburgh Residents Put Up Last Stand, Protesting For More Affordable Housing As Another Aging Complex Falls Victim To Redevelopment

In Pittsburgh, Pennsylvania, WESA-Radio 90.5 FM reports:

• Residents facing eviction from Penn Plaza and their supporters rallied on the steps of the City-County building Tuesday [February 21] afternoon, calling on the city to step up efforts to increase access to affordable housing.
  
  According to Mayor Bill Peduto’s chief of staff Kevin Acklin, about 25 residents remain in the apartment complex and must vacate by March 31 to make way for redevelopment of the site.
  
  “I have a lot of applications in, but we’re turned down everywhere,” said Mabel Duffy,78, who has a Section 8 voucher and has lived at Penn Plaza for nine years. She said she doesn’t know where she is going to move at the end of next month.
  
  Acklin said the city sent a letter to the lawyer for the owners of Penn Plaza, LG Realty Advisors, last Thursday, informing the company it had received complaints from residents related to construction on the site.
  
  In the letter, the city states that residents have complained of faulty heating units, asbestos tiles being torn up without proper precautions and lax security.
  
  Duffy said there is also dust of some sort making its way into her apartment and that she fears for her health.
  
  Duffy’s neighbor, Myrtle Stern, 76, is also concerned about health risks related to construction, and said there is a strange smell on the premises.
  
  The city’s letter to attorney Jonathan Kamin asked for “written assurance that your client will cure these defects to living conditions” and that it will continue to honor the financial commitments agreed upon in a previous Memorandum of Understanding.
  
  LG Realty had previously agreed to provide financial assistance to evicted residents. Acklin said so far, the company has honored that commitment for the more than 350 residents who have already moved out.

For more, see As Residents Rally, City Prepares To File Injunction Against Penn Plaza Developers.

Another Home For The Elderly Bites The Dust; Aging Building In Constant Need Of Repair, Budget Restrictions, Competition w/ Newer Facilities Lead To Displacement For About A Dozen Residents, Job Loss For A Dozen More

In Roxbury, New York, The Daily Star reports:

• The Kirkside Retirement Home in Roxbury is closing April 14, according to board president Thomas Hynes.
  
  The closure has been announced to residents and staff, according to a letter from the board. The adult home has 11 residents and about 12 employees, Hynes said Thursday [March 1], and the pending closure has prompted tears by residents, employees and board members.
  
  “It couldn’t be sadder,” Hynes said Thursday. He said reasons leading to the closure included more retirees staying at home longer, changes in the health care field and Kirkside’s challenges in meeting its annual budget of more than $200,000.
  
  ***
  The Kirkside building was constructed in the late 19th century, according to the facility’s website. [...] Directors said the building “always is in need of repair and updating, fuel costs are high, and we simply can no longer compete with new and more comprehensive care facilities.”
  
  Hynes said the state Department of Health has approved Kirkside’s closure plans. Kirkside, for many, had become home after leaving other residences before moving into a nursing home, he said.
  
  “This is a sad event for everyone involved,” the letter said. “The facility has always operated on a very low budget, and the past five years have been particularly difficult, despite the wonderfully generous support of our community, the state of NY, the O’Connor Foundation, and many other agencies.”
  
  Directors said they worked “very hard to avoid closure” since realizing six years ago that there were “serious difficulties staying afloat.”
  
  “Facilities like Kirkside are less popular than they once were,” the directors said. “In a way, places like Kirkside have gone the way of the large vacation hotels that once were thriving right here in our own area.”

Source: Roxbury nursing home to close in April.

Another Group Of Low-Income Tenants Fall Victim To Building Violations, Face Boot By Town Code Enforcement From Motel Being Improperly Used As Unlicensed Long-Term Rooming House

In West Springfield, Massachusetts, WWLP-TV Channel 22 reports:

• The Medallion Motel in West Springfield was set to close [...] because of code violations, but some of the residents have been given more time to get out.
  
  The Town had been set to condemn the property [], because the fire monitoring system had not been paid for, among other problems. The motel also owes $20,000 in property taxes.
  
  Twenty-four units would be affected by the closure. Several residents had paid the month’s rent in early February, only to learn from management that they would be evicted by the Town. The Town had notified management in November.
  
  Several tenants, many with disabilities and on a fixed income, went to Attorney James Brown, who brought emergency motions to the Town on Friday to get the fire monitoring system paid for.
  
  “We were able to get that paid for and get them back in. So they are not being evicted right yet. However there is a date of April 1 that the Town will condemn the property for being used as a long-term boarding house, when it is only licensed as a hotel,” Brown said.
  
  Brown told 22News that if negotiations fail to get tenants their money back from property management, the next step would be to file a civil case. The company that owns the property is out of Texas.

Source: Medallion Motel tenants given more time before eviction (Town says hotel was being used as a rooming house).

Ex-Real Estate Agent Gets 9+ Years After Jury Conviction For Mortgage Fraud; Among Bad Acts Was Use Of Forged Document To Obtain HELOC In Unwitting Straw Buyer's Name, Promptly Draining Account Of Available Cash Soon After Credit Line Was Funded

From the Office of the U.S. Attorney (Sacramento, California):

• Senior U.S. District Judge Garland E. Burrell Jr. sentenced Alla Samchuk, 45, of Roseville, to nine and a half years in prison for a mortgage fraud scheme and obstruction of justice, U.S. Attorney Phillip A. Talbert announced.
  
  A federal jury returned a verdict in August 2016 finding her guilty of six counts of bank fraud, six counts of making a false statement to a financial institution, one count of money laundering, and one count of aggravated identity theft.
  
  ***
  [One] objective of the scheme was to obtain HELOC (home equity line of credit) funds. According to evidence at trial, on two of the properties, Samchuk diverted or attempted to divert HELOC funds to her own benefit. Samchuk caused the HELOC loans to fund by submitting false statements and documents to the lender regarding the qualifications of the straw buyers.
  
  The scheme involved two properties in Roseville and one in El Dorado Hills. In 2007, Samchuk filed an application for a HELOC on one of the properties without the straw buyer’s knowledge or consent. To obtain the HELOC, she forged the signature of the straw buyer on a short form deed of trust that she caused to be notarized and recorded. The stated purpose of the HELOC was home improvement, but once the line of credit was funded, Samchuk quickly diverted all of the funds to her own use, spending the proceeds on a Lexus and the repayment of a substantial personal debt.
  
  Samchuk received a higher sentence because the district court found that she obstructed justice when she threatened a witness not to report the crime to federal authorities. The court found that Samchuk’s statements to the witness constituted a threat that Samchuk purposefully calculated to dissuade the witness from alerting law enforcement about the fraud.

Source: Roseville Woman Sentenced to 9.5 Years in Prison for Mortgage Fraud Scheme and Identity Theft.

FTC Scores Another Toothless Judgment: Scam Artist That Preyed On Financially Distressed Homeowners By Peddling Bogus Mortgage/Debt Relief Services Need Only Pay $105K Out Of $1.7 Million Order, With Balance Being Suspended

From the Federal Trade Commission (Washington, D.C.):

• The final defendant in an alleged mortgage relief scam that preyed upon distressed homeowners will be banned from selling mortgage or debt relief services under a settlement with the Federal Trade Commission.
  
  The settlement resolves FTC charges against Gabriel D. Stewart in a scheme that operated under the fictitious names “2Apply” and “UW Solutions.” The defendants falsely claimed they could lower consumers’ mortgage payments and interest rates or prevent foreclosure, pretended to be affiliated with a government agency or consumers’ lenders or servicers, and illegally charged advance fees. The case was brought in July 2014 as part of a federal-state law enforcement effort, Operation Mis-Modification.
  
  In addition to banning Stewart from the mortgage or debt relief business, the stipulated order prohibits him from misrepresenting financial and other products and services. It imposes a judgment of more than $1.7 million that is partially suspended and requires Stewart to pay $105,487, representing the amount of money he received from the scam. The full judgment will become due immediately if Stewart is found to have misrepresented his financial condition.
  
  In September 2016, the court entered summary and default judgment against Stewart’s co-defendants, finding them jointly and severally liable, imposing a ban, and entering judgment for more than $1.7 million.

Source: Final Defendant in Alleged Mortgage Relief Scam Settles FTC Charges.

Cops Pinch Purported 'Mortgage Consultant' For Allegedly Making False Promises Of Loan Acquisition Help To Fleece At Least Five Prospective Homebuyers For Over $100K (& Counting)

In Chesterfield County, Virginia, WTVR-TV Channel 6 reports:

• A Chesterfield man was arrested in connection with a mortgage fraud scheme that allegedly swindled victims out of more than $100,000. Timothy S. Wenk, the former owner of Premier Consulting, defrauded victims of money by falsely claiming to help the victims obtain mortgages, police said.
  
  Crime Insider sources told Jon Burkett, Wenk had easy access to an actual mortgage company owned by a close friend.
  
  Five victims reported Wenk kept the money they paid him. At this point, losses reported by the victims totaled more than $100,000, police said.
  
  Wenk, of Hampton Valley Place, has been charged with five counts of obtaining money by false pretenses. The 50-year-old turned himself in to police on Tuesday, Feb. 28, and was released from the Chesterfield County Jail on bond.
  
  Further investigation revealed Wenk has previously been charged with several fraud related crimes.
  
  A man, who asked CBS 6 to hide his identify, said he was almost a victim. “He said if we put down $2,500 to $4,000 then he could get us any type of loan, no matter what the house cost," the man said. He said he sensed the proposal was too good to be true, so he asked for it in writing. He said that’s when all communication abruptly stopped.
  
  The man said he believed Wenk preyed on people with bad credit.
  
  Wenk is set to appear in Chesterfield County General District Court on April 19, 2017, at 1 p.m. Investigators said Wenk also goes by the names Timothy Scott and Timothy Wink.
  
  Anyone who believes they may be a victim was asked to contact Chesterfield County Police at 804-748-1251.

Source: Chesterfield man charged with stealing $100,000 in mortgage fraud scheme.

Queens DA Busts Alleged Mortgage Assistance Scam That Duped Financially Distressed Homeowners Into Unwittingly Signing Over Title To Their Homes; Nine Pinched (Including 3 Lawyers), Two Others Remain Loose

From the Office of the Queens County, New York District Attorney:

• Queens District Attorney Richard A. Brown, joined by New York City Sheriff Joseph Fucito, today (March 1) announced that a Queens County grand jury has charged eleven individuals – including three attorneys(1) – and two real estate corporations with preying on New York City homeowners in financial distress and defrauding them into signing over their properties. Nine of the individuals are presently in custody and the remaining two are being sought.
  
  District Attorney Brown, “Instead of tossing the victims a lifeline, half of whom were elderly individuals, the defendants are accused of creating a financial nightmare for the homeowners and placing them in worse financial situations than when first contacted by the defendants. As a result of the alleged fraudulent deed transfer scheme, the homeowners are no longer the titled owners of their own properties and therefore cannot move toward a resolution with their own mortgage companies. In each case, the homeowner must retain a real estate attorney to have the fraudulent deed reversed, resulting in additional financial hardships on them.”
  
  ***
  The investigation into Kings Development Group was jointly conducted by the Queens District Attorney Office’s Economic Crimes Bureau and the New York City Sheriff Office’s Deed Fraud Unit and allegedly revealed a fraudulent real estate operation in which the “purported assistance” that the defendants offered was actually no assistance at all in resolving the homeowners’ problems with their properties but rather a scheme to get homeowners to unknowingly sign over the deeds to their property.
  
  ***
  The alleged scheme took place between August 2012 and January 2017 and while the defendants allegedly collected rental income from individuals or from the City’s Housing Authority or Human Resources Administration (who were paying shelter expenses for individuals residing at the properties), the homeowners’ properties continued to undergo the foreclosure process and the homeowners’ credit continued to be destroyed.
  

For more, see Eleven Individuals And Two Corporations Indicted In Deed Fraud Scheme (Three Attorneys Among Indicted Defendants; Alleged Victimized Homeowners Include Hospitalized U.S. Veteran Waiting For Organ Transplant And Single Mother With Five Children).

----------------------

(1) The three lawyers bagged in this alleged racket are:

• Attorney Michael Herskowitz, 37, of Brooklyn, charged with second-degree grand larceny, second-degree criminal possession of stolen property, fraudulently obtaining a signature and first degree scheme to defraud.
  
  Attorney Yariv Katz, 43, of New Rochelle, charged with first-degree scheme to defraud, second degree grand larceny, second-degree criminal possession of stolen property, fraudulently obtaining a signature and first-degree scheme to defraud.
  
  Attorney (suspended) Sanford Solny, 59, of Brooklyn, charged with first- and second-degree criminal possession of stolen property, second-degree grand larceny, fraudulently obtaining a signature, first-degree offering a false instrument for filing, first-degree falsifying business records and first-degree scheme to defraud.

3-Judge Federal Appeals Court Panel Allows County To (Unconstitutionally?) Fatten Up Public Coffers At Property Owners' Expense By Snatching & Selling Their Real Estate For Delinquent Property Taxes, Then Pocketing Surplus Sales Proceeds Above & Beyond Outstanding Debt Balance

From a recent press release from the Pacific Legal Foundation:

• The full Sixth U.S. Circuit Court of Appeals should hear the constitutional takings lawsuit brought by several small property owners — including a financially struggling church — who were victimized by a Michigan law that lets local governments seize and sell people’s property for delinquent taxes and deposit the excess proceeds in government coffers instead of returning them to the owners.
  
  So argues Pacific Legal Foundation(1) in a just-filed petition asking the Sixth Circuit to grant en banc review in the case of Wayside Church v. Van Buren County.
  
  ***
  The petitioners represented reflect a cross section of people owning property in Van Buren County, Michigan during the last recession. Wayside Church (based in Chicago) owned and operated a parcel in Van Buren County as a youth camp. Myron Stahl owned a residential lot where he was building his retirement home. Henderson Hodgens owned a 20-acre farm with a home.
  
  Michigan county exploited property owners’ hardships to enrich itself
  
  All fell on hard times and were unable to pay their 2011 property taxes. Van Buren County responded by invoking the Michigan General Property Tax Act to take and sell the properties.
  
  In each case, the sale generated significantly more than the tax debt. Wayside Church’s youth camp parcel was sold for $206,000, more than 12 times the tax debt of $16,750. Stahl’s property was sold for $68,750 to cover a $25,000 debt. Hodgens’s property sold for $47,750, compared to a $5,900 debt. All told, the county garnered $274,850 in after-debt profits from the three sales.
  
  But rather than simply keeping the amount needed to satisfy the tax debt and refunding the remainder to the original owners, the county pocketed the sale profits.
  
  The litigation challenges this egregious self-enrichment as an unconstitutional taking of the owners’ private property, and specifically contends that the Michigan General Property Tax Act violates the Fifth Amendment by permitting such confiscation.
  
  However, a three-judge panel of the Sixth Circuit, on a 2-1 vote, declined even to consider the property rights arguments. Citing a controversial Supreme Court procedural precedent known as the Williamson County case, the two-judge majority held that such takings lawsuits must begin in state court, not federal courts.
  
  Federal courts should not shrink from righting unconstitutional wrongs
  
  “These plaintiffs have already been victimized enough by county bureaucrats,” said PLF attorney Christina Martin. “They should not be victims of the judicial process as well by having the doors of the federal courts shut in their faces. We are asking the full Sixth Circuit to hear this important property rights case, recognize that federal courts should be open and welcoming to people seeking to claim their federal constitutional rights, and issue a clear ruling that foreclosure can’t be abused to fatten public coffers by impoverishing struggling property owners.”
  
  ***
  The case is Wayside Church v. Van Buren County. More information, including the petition for en banc review, is available at: www.pacificlegal.org.
  

Source: PLF challenges abuse of foreclosure process to fatten public coffers.

--------------------------

(1) Based in Sacramento, California, Pacific Legal Foundation (PLF) is a donor-supported, 501(c)(3) national non-profit law firm that litigates in courts nationwide for limited government, property rights, and individual liberty. PLF represents all clients without charge.

Maine Supremes Allow State To Dodge Liability For Grossly Breaching Its Duty Of Care When Acting As Public Guardian For Disabled Man When It Unloaded His Home For Less Than Half Its Assessed Value, Allowed Another House To Reach State Of Disrepair That It Became Uninhabitable, Peddled His Personal Belongings (& Euthanized His Beloved 10-Year Old Cat)

In Rockland, Maine, the Portland Press Herald reports:

• The state is immune from liability for selling the waterfront house of a man in its care for well below its value,(1) allowing another home he owned in Rockland to fall into disrepair,(2) selling off his personal belongings and euthanizing his cat.(3)
  
  The Maine Supreme Judicial Court ruled Thursday [March 2] in the lawsuit brought on behalf of William Dean against the Maine Department of Health and Human Services.
  
  The ruling comes nearly four years after the original lawsuit was filed and nearly six months after the high court justices heard arguments on the matter. Dean has died since that hearing, succumbing to natural causes on Oct. 16. He was 71.
  
  Cynthia Ann Dill, Dean’s Portland-based attorney, said Thursday that she respects the ruling but urged the Maine Legislature to expressly provide by statute that when the DHHS acts as a public guardian it is “accountable for damages caused when, as in this case, the duty of care is so grossly breached.”
  
  Dean suffered from mental health issues throughout his life. Among other things, he had Asperger’s syndrome, an autism spectrum disorder that made it difficult for him to interact with other people.
  
  ***
  In December 2015, Justice Andrew Horton of the Maine Business and Consumer Court in Portland ruled that the lawsuit could go forward on the single issue of whether the state breached its fiduciary duty while it served Dean’s conservator in 2012 and 2013.
  
  The DHHS appealed that lower court ruling. Assistant Attorney General Christopher Taub argued that the state is immune from liability under the Maine Tort Claims Act. He said there are exceptions to the immunity, but only when it is spelled out in other laws approved by the Maine Legislature.
  
  The Supreme Court justices agreed, saying there is nothing in the state’s probate laws that waives immunity, even when the state serves as a conservator for someone in its care.

For more, see State can’t be sued for selling property, euthanizing cat of man in its care, Maine’s top court rules (William Dean died before the conclusion of his four-year case, but now his attorney wants legislation to make the state accountable when ‘the duty of care is so grossly breached’).

-----------------------

(1) According to the story:

• [T]he waterfront cottage [...] was sold for $205,000, even though the town had the property – 1 acre with 100 feet of ocean frontage and the 1,000-square-foot, two-story cottage – assessed for tax purposes at $476,840.

(2) The story states that:

• The state also tried to sell the Rockland home on Broadway, but a pipe burst during the winter when there was no heat and caused major flooding, which then led to mold throughout the home, making it uninhabitable.

(3) According to the story:

• In an October 2015 interview, Dean said the state’s decision to euthanize his longtime companion, a 10-year-old Himalayan cat named Caterpillar, bothered him the most. guardianship

Dad's $200K Restitution Payment Buys Out Jail Time For Thieving Real Estate Agent/Son Who Fleeced Couple Out Of $150K; Prosecutor Reduces Potential Felony Conviction To Misdemeanor

In Fenton, Michigan, the Tri-County Times reports:

• Since he paid restitution of $200,000 to his victims, Thomas (Tommy) Tubbs, 45, of Grand Blanc has fulfilled the conditions of his plea agreement.
  
  According to the agreement, made in August of last year, the Genesee County prosecutor agreed to reduce the charge to a misdemeanor of larceny $200 to $1,000.
  
  Investigators with the Genesee County Sheriff’s Office claimed Tubbs collected $150,000 from an Atlas Township couple for a real estate transaction, but kept the money for himself.
  
  Tubbs, who worked for a Fenton real estate firm, was charged with taking money under false pretenses, according to Genesee County court records. He was originally arrested on Aug. 26, 2015.
  
  On Aug. 19, 2016, during a pre-trial hearing, Tubbs entered into a plea agreement. He pleaded no contest as charged and requested a deferred sentence in order to allow him to pay restitution in full.
  
  Sentencing was originally set for Jan. 9, and then adjourned to Jan. 26.
  
  On Jan. 26, Tubbs was led from the courtroom in handcuffs, according to Fox 66 News. He remained there until he came up with the money. At the time, Tubbs said his father, Jim Tubbs, also a real estate agent, would sell some property to come up with the money.
  
  During his Feb. 10 sentencing, Tubbs was ordered to have no contact with the victims. According to Feb. 10 court records, “The restitution has been paid in full and the charge is hereby amended.”

Source: Tubbs pays restitution (Plea agreement reduces local Realtor’s charges to misdemeanor).

County Employee Responsible For Receiving & Handling Proceeds From Court-Ordered Foreclosure Auctions Gets Four Months In County Jail For Using Forged Documents To Snatch Over $90K In Sales Surplus/Overages Belonging To Ex-Homeowners

In Dayton, Ohio, WDTN-TV Channel 2 reports:

• A former Montgomery County employee was sentenced for theft Tuesday morning [February 28].
  
  David Bruns will spend four months in Montgomery County Jail and pay $39,830 to the county from his retirement account.
  
  Bruns stole about $91,000 over five years from the Montgomery County Prosecutor’s Office’s Delinquent Tax Assessment and Collection Unit.
  
  Bruns worked in the foreclosure department for the county. He was responsible for receiving and handling deposits from foreclosure sales. Special Prosecutor Ron O’Brien from Franklin County, who handled the case, said Bruns modified court records to authorize payments to his dummy corporation to embezzle the money.
  
  Bruns had worked for Montgomery County since 2006 and the Prosecutor’s Office since 2009. He was fired in August 2016.
  
  The Montgomery County Prosecutor’s Office released its victim impact statement. They wrote: “This defendant was employed in a position of trust in our office. He violated that trust by devising schemes to intercept money paid by individuals who were attempting to initiate foreclosure actions and money that would have gone to owners whose property had been sold in a foreclosure action after all creditors had been paid. As a result, some foreclosure actions were delayed and money diverted to the defendant for his own personal gain.”
  
  Bruns was taken into custody immediately following the sentencing. He can also never have a finances-related job again.

Source: Former Montgomery County employee sentenced for theft.

Cops Search For Atlanta-Area Woman Suspected Of Online Scam Peddling Homes She Doesn't Own, Scoring Deposit$ From Unwitting Prospective Buyers

In Forest Park, Georgia, Fox 5 Atlanta reports:

• Forest Park police are searching for a woman reportedly scamming would be homebuyers out of thousands of dollars. Investigators said she posted for sale houses she doesn't own on real estate websites, then collecting fees from people who want to purchases the homes.
  
  Christine Rawlins posted a house she didn't own for sale on the real estate website Trulia, according to police. On February 4, Rawlins met with a victim who contacted her expressing interest in the house. She reportedly told the victim she had power of attorney and was selling the house for her uncle. She was able to convince the victim to give her a $7,500 cashier's check as a down payment on the home.
  
  When Rawlins missed an appointment to turn over the title and house keys and couldn't be reached by phone two days later the victim went to the police.
  
  Police said Rawlins has re-listed the same home for sale on the Trulia site under a different name.
  
  Forest Park Police Sergeant Keli Flanigan told FOX 5, "She's still renting homes as a matter of fact."
  
  There's also a warrant out for the woman's arrest out of Clayton County on larceny charges.
  
  Joshua Kimbrough and his mom paid Christine Rawlins nine thousand dollars after seeing this Jonesboro house for sale on Craigslist last summer.
  
  "They said they was looking for first time buyers. We thought they were honest people basically," said Kimbrough.

Source: Woman wanted for suspected real estate fraud in south metro.

North Of The Border A Safe Haven For Thieving Lawyers? Investigative Report Reveals 220 Canadian Attorneys Faced Discipline For Fleecing About $160 Million From Their Clients Between 2010-2015, But Fewer Than 10 Percent Were Actually Charged With Crimes

From north of the U.S.-Canadian border, CBC News reports:

• More than 200 Canadian lawyers who were disciplined by their law societies between 2010 and 2015 misappropriated about $160 million of their clients' funds, a CBC News investigation has found.(1)
  
  But most of those lawyers were never charged with crimes. CBC could find evidence of criminal prosecutions involving fewer than 10 per cent of the total number of disciplined lawyers in that time frame.
  
  An analysis of public records over six years shows law societies sanctioned 220 members for taking or mishandling money from clients or overcharging them, either negligently or intentionally.​
  
  Lawyers were punished for a variety of infractions, including helping themselves to clients' trust funds, keeping money that belonged to a deceased client's estate, mishandling of client funds, charging for services not provided and charging fees that were so unreasonable that they constituted misconduct.
  
  While some lawyers argued they were not guilty of deliberately doing anything wrong, many others admitted to misappropriation. Some said they lied to regulators when clients complained or when they were caught in spot audits.
  
  Penalties ranged from admonitions and fines to suspensions and disbarments. In some cases, law societies allowed lawyers facing disciplinary charges to resign.
  
  ***
  Criminal convictions are rarely a consequence for lawyers who take clients' money. CBC's investigation could only identify 19 examples of criminal prosecutions between 2010 and 2015. Six of the prosecutions involved lawyers who were disciplined prior to 2010.
  
  One reason for the small number of charges or convictions may be the higher burden of proof required in criminal cases.
  
  In 2015, an Ontario Superior Court judge acquitted a disbarred lawyer of fraud, saying that bad work by a lawyer doesn't necessarily constitute fraud.
  
  Other factors
  
  John Sliter, a retired RCMP superintendent who spent 20 years investigating and managing white collar crime cases, thinks other factors are also at play.
  
  "It becomes very daunting for investigators to even think about investigating, let alone think about facing a potential prosecution, so often what happens is they simply rely on regulation to solve the problem for them," he said.
  
  "In other words, if they've been dealt with by the law society, political masters and police managers will feel that will suffice and that there's no need to pursue a criminal prosecution."
  
  ***
  'Too easy to steal'
  
  Alice Woolley, president of the Canadian Association for Legal Ethics who teaches at the University of Calgary, says no matter how harsh a punishment is, the lawyer will think he's the one who won't get caught.
  
  "If you make it easy for people to cheat, they cheat. If you make it hard, they don't cheat. If people are stealing money that means it's too easy to steal money," she said in an interview.
  
  Woolley says the best way to bring the numbers down is by stopping the lawyers before the money is taken.
  
  "You want to make it so if I have a problem today, I can't fix it this way."
  
  Darrel Pink, executive director of the Nova Scotia Barristers' Society, came to the same conclusion years ago.
  
  "We basically asked the question, does what we do as a legal regulator make any difference?" he said.
  
  "And when we answered it 'Not really,' it was a pretty profound conclusion for us to come to.
  
  "Most lawyer theft is they take a little bit, they intend to give it back, they take a little bit more. They are supporting a gambling habit," said Pink. "And therefore if you could stop them early, you could prevent a lot of harm."
  
  Early signs
  
  Pink says there are usually symptoms such as poor accounting and accounting mistakes. If the lawyer keeps getting away with it, that can eventually lead to missing money.
  
  He is working to get provincial legislation changed so that the law society can regulate law firms and address these accounting problems before they escalate.
  
  Woolley says change can be difficult in a profession that is self-regulated.
  
  "The problem with self-regulation is that it stops innovation, it stops people from making the changes that need to be made because they're afraid of what it might mean for the profession."

For the story, see Lawyers misappropriated millions from clients' funds but few faced criminal charges (Disciplinary actions include suspension, disbarment for professional misconduct).

For the CBC News televised investigative report, see The Fifth Estate: Betrayal of Trust.

------------------------

(1) For "attorney ripoff reimbursement funds" that provide some reimbursement for losses suffered by clients due to the dishonest conduct of lawyers licensed in the various provinces throughout Canada or in the various states throughout the U.S., see:

• Directory Of Lawyers' Funds For Client Protection (February 2017) (includes a listing for Canadian client protection funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.

After Having Already Served Time Relating To State AG's Prosecution For Major Client Ripoffs, Ex-Attorney Now Faces 'Round 2' With NJ Feds In Connection w/ Fleecing Trust Funds; Lawyers' Client Protection Fund Has Already Coughed Up Over $8.3 Million To Defendant's Victims For Loss Reimbursements

From the Office of the U.S. Attorney (Camden, New Jersey):

• A former New Jersey attorney and his father have been indicted for their respective roles in a $13 million Ponzi scheme,(1) U.S. Attorney Paul J. Fishman announced today [February 17].
  
  Michael W. Kwasnik, 47, of North Miami Beach, Florida, and William M. Kwasnik, 68, of Marlton, New Jersey, were indicted Feb. 16, 2017, by a federal grand jury on three counts of wire fraud, two counts of mail fraud, one count of conspiracy to commit money laundering, and seven counts of money laundering. Michael Kwasnik was also charged with eight additional counts of transacting in criminal proceeds.(2)
  
  ***
  Michael Kwasnik previously owned and operated a law firm, Kwasnik, Rodio, Kanowitz and Buckley P.C. – and its successor firm, Kwasnik, Kanowitz and Associates P.C. – with offices in Cherry Hill, New Jersey, and Philadelphia, Pennsylvania. William Kwasnik owned and operated an insurance company, Abby Grant, in Lakewood and Cherry Hill, New Jersey.
  
  According to documents filed in this case and statements made in court:
  
  From October 2008 to November 2011, [... t]he Kwasniks allegedly carried out a scheme to defraud clients of the Kwasnik law firm by diverting funds from their trust accounts to themselves and the entities they controlled. Michael Kwasnik and others induced clients to establish various types of trusts based on misrepresentations and false pretenses.
  
  Michael Kwasnik named himself as the clients’ trustee and directed clients to transfer their money, property and other assets into their trust accounts. Michael Kwasnik then transferred the money out of the clients’ trust accounts and into accounts which he and his father controlled.
  
  More than $13 million was collected from more than 40 clients over the three-year period.(3) The Kwasniks laundered the funds through the entities they controlled and Abby Grant before ultimately using the stolen funds to pay for legal and operational expenses of the entities they controlled, the law firm, and personal expenses.

Source: Former New Jersey Attorney and Father Indicted in Connection with $13 Million Ponzi Scheme.

------------------------------

(1) See generally, Frederick Miller, "If You Can't Trust Your Lawyer .... ?", 138 Univ. of Pennsylvania Law Rev. 785 (1990) for more on the apparent, long-standing tolerance for deceit by many in the legal profession (while Professor Miller's essay is over a quarter-century old, it appears that his observations maintain their vitality to this day):

• This tolerance to deception is encouraged by the profession's institutional civility. Seldom is a fig called a fig, or a shyster a shyster. No, our euphemisms are wonderfully polite: "frivolous conduct," or a "lack of candor;" or "law-office failure;" or, heaven forbid, a "peculation," a "defalcation," or a "negative balance" in a law firms's trust account.
  
  There is also widespread reluctance on the part of lawyers --- again, some lawyers --- to discuss publicly, much less acknowledge, that they have colleagues who engage in deceit and unprofessional conduct.
  
  This reluctance is magnified when the brand of deceit involves the theft of client money and property, notwithstanding that most lawyers would agree that stealing from clients is the ultimate ethical transgression.
  
  ***
  The fact is, however, that theft of client property is not an insignificant or isolated problem within the legal profession. Indeed, it is a hounding phenomenon nationwide, and probably the principal reason why most lawyers nationwide are disbarred from the practice of law.

(2) Kwasnik has already faced prosecution for state law crimes by the New Jersey Attorney General's office in connection with client ripoffs. See Lawyer Sentenced for Laundering Funds Misappropriated from Clients (Michael Kwasnik served five months in jail and must pay $1.2 million in restitution).

(3) According to the itemized list issued by the New Jersey Lawyers' Fund for Client Protection for the third quarter of year 2015 claim awards for whom reimbursement payouts to victimized clients were made, the Fund had already coughed up $8,308,920.16 to former clients for their losses suffered by Kwasnik's handiwork.

The New Jersey Lawyers' Fund for Client Protection was established to reimburse clients who have suffered a loss due to dishonest conduct of a member of the New Jersey Bar.

For similar "attorney ripoff reimbursement funds" that attempt to clean up the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (February 2017) (includes a listing for Canadian client protection funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.

State Bar Trash-Cans Sleazy Lawyer's Resignation Letter, Gives Him The Boot Instead Amid Probe Into Allegations That He Ripped Off Thou$and$ From Clients, Blaming Secretary In One Incident; Local Prosecutors Say No Criminal Charges Pending

In Brentwood, California, the East Bay Times reports:

• An attorney who had been practicing law for 35 years was disbarred after allegations came to light that he’d misappropriated thousands of dollars that should have gone to his clients.(1)
  
  [Last] month the California State Bar announced its decision to disbar Walter Lee Davis, who had a law office in Brentwood, after accusing him of violating the state’s rules of professional conduct and the business and professions code 13 times. The charges say Davis lied to two clients and took approximately $11,000 that should have gone to them.
  
  On top of those charges, state officials are investigating a client’s complaint that Davis misappropriated an additional $47,000.
  
  Davis could not be reached for comment. Phone calls to his Brentwood offices yielded a voice mail message that said the line had been disconnected.
  
  Two days before state officials were set to decide on a penalty for Davis, he submitted a letter of resignation. It was rejected after state officials noted, “(Davis) is charged with serious acts of misconduct, including the misappropriation of funds, and is being investigated for further serious acts of misconduct.”
  
  After Davis failed to show up to a January 2016 state bar hearing, his case was entered into default and state officials recommended his right to practice law be revoked, records show. That was finalized late last year.
  
  Before these allegations surfaced, Davis had a discipline-free history as a lawyer, according to state bar records.
  
  Davis was charged with taking money from a client he represented in a personal injury matter. In August 2014, Davis allegedly signed a release to receive a $9,000 settlement check, then failed to tell his client about the money. The client was entitled to $6,000 of the settlement, but never received it.
  
  When confronted, Davis allegedly blamed the misappropriation on his secretary. The next month, he allegedly failed to tell another client of a $7,800 settlement, and failed to pay the client $5,200 he was owed.
  
  Contra Costa prosecutors say no charges are pending against Davis. The state bar can refer certain cases to prosecuting agencies if it sees fit, but that’s rare.

Source: Brentwood lawyer disbarred, investigated over missing $58K.

--------------------------

(1) The California State Bar's Client Security Fund is a public service of the California legal profession, intended to help protect consumers of legal services by alleviating losses resulting from the dishonest conduct of attorneys. The amount the fund may reimburse for theft committed by a California lawyer depends on when the loss occurred. A maximum of $50,000 is reimbursable if the loss occurred before January 1, 2009. A maximum of $100,000 is reimbursable if the loss occurred on or after January 1, 2009.

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (February 2017) (now includes Canadian recovery funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.

Lawyer Disciplinary Board Nixes Depression, Alcoholism Defense, Gives Attorney Bar Boot For Draining At Least $300K From Law Firm's Trust Account; Victims Include Disabled, Homeless Client ($115K) Over Whom Money Snatcher Had POA, & Disabled, Stroke-Stricken Ex-Common Law Wife (Proceeds From House Sale)

In Edmonton, Alberta, The Globe And Mail reports:

• A prominent Edmonton lawyer has been disbarred after a Law Society panel found he misappropriated at least $300,000 from clients and other lawyers at his firm.(1)(2)
  
  Shawn Beaver sat silently through the decision, which came after a hearing that spanned two weeks and included testimony from clients, former partners and colleagues in the firm, and Mr. Beaver himself. Behind him, his wife and daughters wept as the decision was read.
  
  “Mr. Beaver has not yet rehabilitated himself, and he needs to be out of practice while that takes place,” said Fred Fenwick, the chair of the three-person Law Society of Alberta disciplinary panel, in rendering the decision late on Wednesday afternoon.
  
  The panel previously heard evidence that Mr. Beaver had drained his firm’s trust fund over a period in 2014 and early 2015, which included taking $115,000 from a disabled and homeless client over which he had power of attorney, more than $5,000 from an education fund for the children of one of his employees’ brothers who had recently died, and a large settlement obtained by a colleague who had been out of work for a long period because of illness. The panel, which was comprised of two lawyers and a non-lawyer, also found Mr. Beaver wrongfully kept proceeds of a house sale from his former common-law wife, who had been severely disabled after a stroke.
  
  Mr. Beaver admitted to three Law Society offences, was found guilty of four others and was not convicted of five more. He has been suspended since the trust-fund shortages were discovered by other lawyers in his firm in May of 2015.
  
  ***
  During the hearing, Mr. Beaver testified that he suffered severe depression and was dealing with alcoholism in the period where the money was taken, which he said was prompted and exacerbated by the death of his mother and the breakdown of a relationship.
  
  He said the money was taken to keep the firm afloat, as he lost control of his business while dealing with his mental and addiction issues.
  
  In its decision, the Law Society found Mr. Beaver took the money both for his firm and his own lifestyle.
  
  ***
  But Mr. Fenwick said the panel concluded disbarment of Mr. Beaver was necessary to maintain the public’s confidence in the legal profession, and for the general deterrence of other lawyers.
  
  In addition to the disbarment, the panel ordered that Mr. Beaver pay $120,000 in costs for the Law Society’s investigation and the hearing against him. The case is also being filed to the attorney-general for criminal investigation.

For the story, see High-profile Alberta lawyer disbarred for draining firm's trust fund.

See also, ‘Nothing short of catastrophic’ (Shawn Beaver was once considered one of Alberta’s top legal minds. Then money started to go missing from clients’ accounts).

----------------------------

(1) See generally, Frederick Miller, "If You Can't Trust Your Lawyer .... ?", 138 Univ. of Pennsylvania Law Rev. 785 (1990) for more on the apparent, long-standing tolerance for deceit by many in the legal profession (while Professor Miller's essay is over a quarter-century old, it appears that his observations maintain their vitality to this day):

• This tolerance to deception is encouraged by the profession's institutional civility. Seldom is a fig called a fig, or a shyster a shyster. No, our euphemisms are wonderfully polite: "frivolous conduct," or a "lack of candor;" or "law-office failure;" or, heaven forbid, a "peculation," a "defalcation," or a "negative balance" in a law firms's trust account.
  
  There is also widespread reluctance on the part of lawyers --- again, some lawyers --- to discuss publicly, much less acknowledge, that they have colleagues who engage in deceit and unprofessional conduct.
  
  This reluctance is magnified when the brand of deceit involves the theft of client money and property, notwithstanding that most lawyers would agree that stealing from clients is the ultimate ethical transgression.
  
  ***
  The fact is, however, that theft of client property is not an insignificant or isolated problem within the legal profession. Indeed, it is a hounding phenomenon nationwide, and probably the principal reason why most lawyers nationwide are disbarred from the practice of law.

(2) The Alberta Lawyers Insurance Association (ALIA) manages the insurance program for Alberta lawyers. Similar to malpractice insurance, the program, better known as the Alberta Lawyers Insurance Exchange (ALIEX) provides professional liability insurance to Alberta lawyers.

Making a Claim: If you have suffered a financial loss from working with your lawyer or as a consequence of the services provided by your lawyer, you may be entitled to make a claim. If the loss was due to theft or negligence by your lawyer, please read How to Make a Claim.

For similar "attorney ripoff reimbursement funds" that attempt to clean up the financial mess created by the dishonest conduct of lawyers licensed in other Canadian provinces or in the states throughout the U.S., see:

• Directory Of Lawyers' Funds For Client Protection (February 2017) (includes a listing for Canadian client protection funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.

Disbarred Lawyer's Failure To Cough Up $28K+ To State's Client Protection Fund As Reimbursement For Amount Shelled Out To Ripped Off Clients Cited As Strong Reason To Nix License Reinstatement Request

In Albany, New York, the Albany Times Union reports:

• A Saratoga Springs lawyer who was disbarred in 2008 after he failed to reimburse $28,845 to clients will not get his law license back, the Appellate Division of state Supreme Court ruled Thursday [February 16].
  
  The Appellate Division's Attorney Grievance Committee opposed Matthew S. Hogan's request for reinstatement. Hogan made the request in November.
  
  The Lawyers' Fund for Client Protection(1) also opposed the application and, according to the ruling, noted that between 2009 and 2011 it paid $28,845 to Hogan's former clients but Hogan failed to make any reimbursement.
  
  The justices ruled against reinstating Hogan after considering his failure to repay his clients and other evidence that they ruled showed he didn't possess the "requisite character and fitness to resume the practice of law or that his reinstatement would be in the public interest."

Source: Appellate justices reject lawyer's bid to get license back (Matthew S. Hogan practiced in Saratoga Springs until 2008 disbarment for failure to reimburse clients).

--------------------------

(1) The Lawyers' Fund For Client Protection of the State of New York exists to (at least partially) compensate clients harmed by a fraudulent or dishonest act involving client money by a New York lawyer.

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (February 2017) (includes Canadian recovery funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.