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  • Inside Track
    June 01, 2016

    Restoring Public Trust: Client Protection Committee Pays Out More Than $215,000 to Lawyer Theft This Year

    Client trust is crucial to the legal profession. When that trust is violated by lawyers who take money from their clients, it is the duty of the Wisconsin Lawyers’ Fund for Client Protection Committee to restore the lost funds and trust in the legal profession to victim clients.

    June 1, 2016 – It threatened to end a church’s outreach, and it involved making a business out of fraud and taking money away from the care of a disabled daughter.

    It is the work of dishonest lawyers, taking money from the clients who turn to lawyers to solve problems, not add to them.

    It is the task of the State Bar of Wisconsin Lawyers’ Fund for Client Protection Committee to do what they can to restore victim clients’ trust in the legal system, to make people and communities whole again.

    For the 2015-16 fiscal year, the committee paid $215,730.19 to 34 clients who were victims of theft from 11 lawyers.

    “It really is an honor to represent the profession to these clients,” says Lindsey Draper, who has served more than 10 years on the committee. It is important for the clients to know that the vast majority of lawyers do not victimize their clients. “We want the clients to know: we don’t intend to see you hurt by the acts of these members of our profession.”

    A Profession Based on Trust

    It is something to be proud of, says Wayne Maffei, the chair of the committee, who has served on the committee for a total of more than 10 years. “To my knowledge, we’re still the only profession that attempts to repair the damage caused by the dishonest conduct of its members.”

    Clients become victims because they trust lawyers - a very necessary part of the work lawyers do is founded in trust, reinforced by ethics rules and the Attorney's Oath. This trust is good for the profession, says committee member Amy Wochos. “That necessary trust is why it can have devastating results if the attorney is not as honest and ethical as the vast majority of attorneys.”

    Restoring the trust as well as the funds lost makes a big difference in people's lives. “We help restore the integrity of the profession. Because the profession is based on trust," Maffei says.

    Doing Right as a Profession

    It is unfortunate that the fund is necessary, says committee member Amy Wochos. “The good news is a very tiny percentage of attorneys steal from their clients. The bad news is, some always will. The fact that there are few of them is not any comfort to the client whose attorney is a thief.”

    The fund’s money comes from a Supreme Court assessment paid by every lawyer in Wisconsin: $20 per year goes into the Client Protection Fund.

    Client Protection Committee 2015-16

    Members of the Client Protection Fund Committee include, on left from top to bottom: Wayne Maffei, chair; Kris Wenzel, State Bar staff liaison; Catherine Zimmerman; Amy Wochos. Right, top to bottom: Deb Smith, Steve Chiquoine, Lindsey Draper.

    It is important that all pay into the fund, says Maffei. “We all have an obligation to fix it. We are all responsible for ensuring the integrity of the profession as a whole."

    That’s the important point, says Draper. “I really appreciate the fact that, while a few have hurt clients, I get to be the face of the 25,000-plus members who contribute to make sure we do right as a profession.”

    When Wochos began her service on the committee, she was surprised at how many claims are filed. “It always seems like there were more claims than money available,” Wochos says.

    Wochos’ interest in service on the committee started when she was appointed as Board of Governors’ liaison to the committee. She subsequently asked to be on the committee, and has just completed her fifth year. “This is one of my favorite committee appointments,” Wochos says.

    Those appointed to the committee, like Wochos, serve five-year terms. These longer terms are essential, allowing committee members to build necessary institutional knowledge, according to Wochos. This allows members to thoroughly learn not only policies and procedures, but also the best ways to analyze these claims. “It’s a fascinating process," Wochos says.

    The Trust Given, Damaged, Restored

    Declaring a colleague dishonest isn’t easy, says Draper. Things happen in their lives.    

    Others perhaps make it easier, such as the lawyer who took enough money from a Milwaukee church that would have had to close down its programs had the committee not returned what was lost. “This was now affecting a community. That’s the ripple effect – one person’s dishonest actions could’ve had devastating effects on the community,” Wochos says. The committee gave back a large percentage of the money that was taken, lessening the damage.

    Another attorney took money from a couple who asked him to set up a trust to cover the care for their adult disabled daughter after they passed away. “We did so much more than just give them their money back, we gave them the peace of mind of knowing that their daughter would be OK after they are gone. That’s what I think our fund represents,” Draper says.

    More recently, another attorney made a business of fraud, creating legal trusts that could not do what she said they could do. She “created a business of fraud, which in some ways is just as bad if not worse than a person who just steals the money opportunistically,” Wochos says.

    And there is the story of an elderly disabled client whose money was stolen by a dishonest attorney, leaving the client without any means to support the care she needed. “The harm perpetrated by the lawyer’s actions was really severe, to the point where it had a direct impact on this client’s life and whether she could even function,” Maffei says.

    The committee returned the money. “I remember how grateful and relieved she was when we did that. I remember getting letters from her that her faith in the profession has been restored,” Maffei says.

    Replacing So Much More

    It’s important, Draper says, to stop and think about what happens when a dishonest lawyer takes money from clients. “When people go to lawyers, it is because they trust that word ‘attorney,’ ‘lawyer,’” he says. They turn to lawyers out of need - sometimes scraping together the money to pay.

    That makes it more egregious when the thefts occur. “A lot of harm comes if somebody rips off someone who’s struggling. That’s why it’s important to be able to say, ‘this is not the end of the story. Let us help.’ So, when we are able to say, we are so sorry, we’re able to replace that, we’re actually replacing so much more than the dollars they lost,” Draper says.

     

    More than $215,000 in Reimbursements Approved for Victims of Lawyer Theft

    The Wisconsin Lawyers’ Fund for Client Protection Committee recently approved reimbursements to 34 victims of lawyer theft for the fiscal year 2015-16.

    The committee over the past year considered 34 claims involving 11 attorneys totaling $215,730.19 out of a total amount of $269,788.54 requested.

    The claims include reimbursements for:

    • Theft from estate: $84,500
    • Misappropriation of funds: $13,908.47
    • Unearned advanced fees: $117,321.72     

    Since 1981, more than $6 million has been returned to 879 victims of lawyer misconduct in Wisconsin.

    Each claim is individually investigated and reimbursement decisions are made at the discretion of the committee, which meets three times a year. Some of the money is returned to the committee fund via court-ordered restitution or voluntary payments from the lawyers who have approved claims against them.

    Wisconsin lawyers share in the efforts to make victims whole: $20 of every member’s State Bar dues finances the fund by Supreme Court Rule.

    For more information about the fund, contact Kris Wenzel or call (800) 444-9404, ext. 6185; or (608) 250-6185.

    Claims were Approved for Clients of:

    • Jeffrey John Aleman, Chicago: One claim of unearned advanced fees, $1,100
    • Ernesto Chavez, Madison: Two claims of unearned advanced fees totaling $3,000
    • Sean D. Cooper, Milwaukee: Two claims of unearned advanced fees totaling $2,900
    • Robert Paul D’Arruda, Milwaukee: One claim of unearned advanced fees, $2,500
    • Tina M. Dahle, Green Bay: One claim of unearned advanced fees, $27,007.72
    • Perry H. Friesler, Milwaukee: One claim of theft from an estate, $84,500
    • Thad M. Gegner, Eau Claire: Four claims of unearned advanced fees totaling $7,794
    • Sarah E. K. Laux, Greenfield: 18 claims of unearned advanced fees totaling $84,270
    • Tim Osicka, Schofield: One claim of unearned advanced fees, $750
    • Alan R. Stewart, Appleton: One claim of unearned advanced fees, $8,000
    • Randy J. Wynn, West Allis: Four claims of misappropriation of funds totaling $13,908.47


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