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  • Inside Track
    July 17, 2019

    'Help Your Colleagues': More than $207K Reimbursed for Lawyer Theft

    The Wisconsin Lawyers' Fund for Client Protection Committee reimbursed more than $207K to 36 victims of lawyer theft over the past year. Committee Chair Benjamin Kurten makes a request: help prevent claims by helping each other as colleagues.

    July 17, 2019 – Benjamin Kurten, chair of the Wisconsin Lawyers’ Fund for Client Protection Committee, has a request of State Bar members: when you see a colleague who may be in trouble, step in to help.

    No one goes to law school with the intent to harm clients – something happens along the way. “It could be a physical or mental health impairment, substance abuse issues, or even a reaction to overwhelming stress,” Kurten said.

    Yet, these issues can lead to client harm, such as misappropriation of funds. When that happens, these clients can apply to the committee to have the funds restored to them.

    The committee’s task is to pay back funds taken dishonestly from clients by their lawyer. During the past year, the committee paid $207,851.12 to 36 clients who were victims of dishonest conduct by 15 lawyers. The claims include cases involving unearned advanced fees, misappropriation of funds, and trust account conversions.

    “Our committee takes each claim very seriously. The claims are vetted thoroughly, and we give both the attorney and claimant an opportunity to provide their side of the story and supporting evidence,” Kurten said.

    Benjamin Kurten

    “We all have a responsibility to keep an eye on each other in a helpful way,” says Benjamin Kurten, chair of the Wisconsin Lawyers’ Fund for Client Protection Committee. “If you see someone having a problem, reach out to them, and talk to them as a friend.”

    Some claims reach more than $100,000, and many involve only a small number of attorneys with multiple claims against them.

    “What could we have done as a group to prevent this?” Kurten asked.

    “I can’t help think that, if someone had helped them, then maybe we wouldn’t need to pay these multiple high-cost claims,” Kurten said.

    The committee’s work is a good reminder: “We all have a responsibility to keep an eye on each other in a helpful way,” Kurten said. “If you see someone having a problem, reach out to them, and talk to them as a friend.”

    If you’re not sure how to reach out to them, the State Bar has a program that can help: The Wisconsin Lawyers Assistance Program, or WisLAP.

    There are options through WisLAP. “We can coach you through what to say and how to say it. Or we can come do it with you. Or you can call WisLAP confidentially, and we will reach out to them, and not reveal who called us,” said Mary Spranger, WisLAP manager.

    “You may think that you don’t want to get a colleague in trouble,” Spranger said. “But the reality is that they are already in trouble – and you’re getting them help.”

    “Otherwise, in the end, we all end up paying – monetarily through claims, and in the damage to our reputations as lawyers,” Kurten said.

    About the Fund for Client Protection

    The Wisconsin Lawyers' Fund for Client Protection, created by the Wisconsin Supreme Court in 1981, reimburses clients who incur financial losses from the dishonest conduct of their attorneys.

    Wisconsin lawyers share in the efforts to make victims whole: the fee of $20 is assessed by the Wisconsin Supreme Court and collected by the State Bar of Wisconsin with annual dues statements. The amount of the assessments determined by the committee each year by Supreme Court Rule. For 2018-19, that amount was $20, an amount that has not changed since 2013.

    The amount may increase $5 to a total of $25 for fiscal year 2021, under a petition that is expected to be filed this year.

    In April, Steve Chiquoine, then chair of the committee, informed the State Bar Board of Governors that the committee reviewed financials from 2013 to the present, and found that in four of the past six years, claims were deferred for payment due to insufficient available funds. The fund has experienced an increase in the number of larger recoverable approved claims, and a fee increase is required in order to fulfill the fund’s mission, he said.

    The State Bar Board of Governors in June unanimously approved the forthcoming proposal, which will be filed by the Client Protection Committee, to increase the annual assessment from $20 to $25.

    Compensating Victims of Lawyer Misconduct

    Since 1981, more than $6.5 million has been returned to 975 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 fund via court-ordered restitution or voluntary payments from the lawyers who have approved claims against them.

    For more information about the fund, contact Bryant Park, or call (800) 444-9404, ext. 6083, or (608) 250-6083.

    The Details: Claims for 2018-19

    Between July 1, 2018, and June 30, 2019, the Wisconsin Lawyers’ Fund for Client Protection Committee considered 63 new claims, and approved 36 claims, reimbursing a total of $207,851.12.

    The 36 claims were approved for clients of:

    • Sarah Clemment (n/k/a Sarah Lawman): 1 claim for $5,000;
    • Cole White: 3 claims for a total of $14,840;
    • Sarah EK Laux: 5 claims for $18,522;
    • Courtney Kelbel: 8 claims for $14,793.75;
    • David J. Bartz: 1 claim for $1,081.05;
    • James Fetek: 1 claim for $4,812.96;
    • Everett Wood: 1 claim for $321.25;
    • Mark Ruppelt: 1 claim for $8,432.22;
    • James Runyon: 7 claims for $69,997.89;
    • Jeffrey Blessinger: 1 claim for $2,000;
    • Gordon Aaron: 2 claims for $1,000;
    • Donald Hahnfeld: 1 claim for $32,800;
    • Chris Petros: 1 claim for $24,000;
    • Jesse Johansen: 1 claim for $1,500; and
    • Stanley W. Davis: 2 claims for $8,750.

    The claims include reimbursements for:

    • unearned advanced fee: 32 claims totaling $150,294.22;
    • misappropriation of funds: 1 claim totaling $1,081.05; and
    • trust account conversion: 3 claims totaling $56,475.85.

    The committee also paid the remaining balance of a deferred 2017-18 payment of $52,000.

    The committee postponed payment on two claims for more than $135,000 each due to missing information. If paid, either one would deplete the 2018-19 fund; both could be approved in the next fiscal year.



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