Lawyers Stealing Settlements: How Your Attorney May Be Robbing You Blind

As a victim seeking justice, the last thing you expect is for your attorney to betray you. Sadly, lawyers stealing settlements is common, leaving victims without the money they need¹.

Some lawyers use deceitful tactics to misuse client funds and break their duty of trust¹. This can lead to financial struggles for victims. In severe cases, these lawyers might face serious criminal charges¹.

If you’ve been cheated by an attorney, you might be able to sue for malpractice¹. You can also ask your state’s bar association to take action¹. It’s important to watch out for your interests, as the harm from lawyer theft can be huge¹.

Key Takeaways:

Unethical lawyers may steal client settlements through mishandling funds, breaching fiduciary duty, and fraudulent practices.
Victims can face significant financial hardship and may be able to take legal action for malpractice and seek disciplinary action.
Lawyers involved in settlement theft can face criminal charges, including misdemeanor or felony fraud.
Vigilance and proactivity are crucial in protecting your interests when dealing with an untrustworthy attorney.
Victims should be aware of the potential consequences of lawyer settlement theft and take steps to safeguard their rights.

Understanding the Unethical Practice of Settlement Theft

Burglary and Unlawful Entry: Drawing Parallels

Burglary is linked to theft and robbery, with intent being key. Lawyers who take client money without permission are like burglars. They break the law by taking money that doesn’t belong to them². It’s hard to prove intent, but lawyers might argue the actions don’t fit the legal definition of burglary.

When lawyers mix client money with their own, it’s a big problem. This makes it hard to know who the money belongs to². Laws are strict about how lawyers handle client money to keep things fair and honest².

Getting caught can lead to serious trouble. Lawyers might face disciplinary actions or even criminal charges². These can include fines, having to pay back money, or even going to jail².

Lawyers often get paid a percentage of what they win for their clients³. It usually takes a few days for the money to clear, but sometimes it takes longer³. They must put the money in a special account until everything is settled³.

Breaking the rules can lead to big trouble. For example, lawyer Michel Avenatti got 14 years in prison for taking money from a client³. Many lawyers are facing serious consequences for their actions⁴.

“Lawyers who commingle funds may face civil lawsuits from clients for breach of fiduciary duty, conversion, or legal malpractice, which can result in damages being paid to the client.”

The Lawyers Stealing Settlements Epidemic

Lawyers stealing settlements from clients is becoming more common. Many reports show attorneys taking money that doesn’t belong to them⁵. This is a big problem because lawyers have a lot of power over their clients’ money⁵. Clients often suffer financially because of this betrayal of trust.

Recent cases have highlighted how widespread this issue is⁵. David Lira, who worked for Tom Girardi for over 20 years, is banned from handling client money⁵. Keith Griffin, another long-time Girardi employee, had his license suspended for six months for hiding settlement information⁵. It’s clear that Lira and Griffin knew about Girardi’s misuse of client funds, including money from the Boeing 737 Max crash⁵.

This problem isn’t just about a few bad apples⁶. In the fiscal year ending Sept. 30, 2022, settlements and judgments under the False Claims Act hit over $2.2 billion⁶. This is the second-highest amount in a single year, showing how big the problem is.

The effects of this epidemic can be very harsh, as seen in the Lion Air Flight 610 crash case⁷. Thomas Girardi and his firm are accused of taking over $3 million meant for the victims’ families⁷. They used this money for their own expenses and to help other clients⁷. Girardi also lied to the victims about their settlement money⁷.

The rise in lawyers stealing settlements shows we need more accountability in the legal field. Clients trust their lawyers with their money and well-being. It’s important for the legal community to tackle this issue and protect clients’ rights.

Identifying the Red Flags

As you move through the legal world, it’s key to watch out for red flags. These could mean your lawyer is up to no good, like stealing your settlement. A big warning sign is if your lawyer doesn’t talk to you much or keeps things secret⁸.

Lawyers who don’t keep you in the loop or dodge questions about your money might be hiding something. The American Bar Association says lawyers should get back to you within a day or two. But some might ignore you or take too long⁸.

Lack of Communication and Transparency

If your lawyer won’t share money details or settlement papers, that’s a bad sign. Good lawyers should be open and honest with you⁹.

Also, if your lawyer doesn’t answer your calls or seems to brush off your worries, they might be hiding something. The State Bar of Texas says it can take a month to deal with a complaint against a lawyer. This shows how important it is to keep talking and be clear⁹.

By staying alert and spotting these warning signs, you can protect your money and make sure it’s handled right.

Protecting Your Interests: Steps to Take

If you think your attorney might be taking your settlement, act fast to protect your interests¹⁰. Keep a close eye on your case and money. Ask your lawyer for detailed reports often to make sure everything is clear and fair¹⁰.

If you’re not getting the answers you need, talk to another lawyer. They can guide you on filing a claim or reporting your lawyer to the state bar¹¹. Remember, your lawyer should have a plan for closing their office if they can’t work anymore. You might need to choose someone to help protect your case¹¹.

Your main goal is to get your settlement and make sure it’s handled right¹². Most cases settle out of court, so good negotiation skills are key. By being proactive, you can keep your settlement safe and make sure it’s used for what it’s meant for.

Action	Description
Monitor Case and Financial Information	Closely track your case details and financial records to ensure transparency and accountability from your attorney.
Request Detailed Accounting	Regularly request detailed accounting from your lawyer to understand the status of your settlement funds.
Seek Independent Legal Advice	Consider consulting an independent legal professional to navigate the process of filing a malpractice claim or reporting the attorney.
Appoint an Assisting Attorney	Understand the importance of appointing an Assisting Attorney to protect your interests in the event of your lawyer’s death, disability, or incapacity.
Negotiate Settlement Terms	Leverage your negotiation skills to effectively address your needs and concerns during settlement talks.

By following these steps, you can protect your client interests and make sure your settlement is handled right. Remember, you have the right to legal recourse if your attorney is mishandling your settlement.

“Protecting your interests is crucial when dealing with a potential settlement theft. Take proactive steps to ensure your attorney is acting in your best interests.”

¹⁰¹¹¹²

Lawyers Stealing Settlements: Consequences and Recourse

Attorneys who steal settlements face serious consequences. They might face lawsuits, disciplinary actions, or even criminal charges¹³. This is because of their unethical behavior.

Those who have had their settlements stolen can take legal action. This can help them get their money back and more. But, it’s a long and complex process. It shows why it’s so important to stay alert and protect your interests¹³.

Disciplinary proceedings for unethical conduct must be considered a likely possibility¹³.
Lawyers who fail to uphold their duties and get disbarred due to improper use of client funds represent a very small percentage among the legal profession¹⁴.
The Lawyers’ Fund in New York State has reimbursed victims of attorney wrongdoing since 1982, paying out upwards of $132 million in awards of reimbursement¹⁴.

If an attorney steals a client’s settlement, the client might have a malpractice claim. Even if the attorney is disbarred or suspended. Getting legal advice is key to see if the claim is valid and to file it on time¹³.

Consequence	Description
Malpractice Lawsuits	Clients can seek compensation for financial losses through legal malpractice claims.
Disciplinary Actions	State bar associations can take disciplinary actions against attorneys, including disbarment.
Criminal Charges	Attorneys who engage in settlement theft may face criminal charges for their actions.

“Checking the standing and license status of attorneys before engagement is recommended to ensure trustworthiness and avoid potential malpractice issues.”¹⁴

Understanding the consequences of settlement theft and legal options helps clients protect themselves. They can take steps to ensure their interests are safe. And they can seek disciplinary actions against attorneys who break their trust¹³¹⁴.

Conclusion

Lawyers stealing settlements from clients is a big problem that needs to be fixed fast. Knowing the warning signs, like not hearing from your lawyer or not being clear about your case, can help you avoid this issue. Cases like Kelly Duford Williams show the harm that can happen when lawyers take money meant for their clients.

To keep your money safe, you should watch your case closely and ask for updates often. If something goes wrong, you can try to fix it through legal means. Even in tough cases like class actions¹⁵, don’t give up. Keep fighting to get what you’re owed.

Learning how to protect yourself from settlement theft can make you feel more in control of your legal journey. Remember, the fight against lawyers taking money is never-ending. But by being careful and proactive, you can lower the risk and protect your money¹⁶.

FAQ

What are some of the deceptive tactics lawyers may use to steal their clients’ settlements?

Lawyers might use dishonest tactics to take their clients’ settlements. They could mishandle funds, break their duty to the client, or use fake settlement practices. This leaves clients without the money they need and can cause big financial problems.

How is stealing settlements similar to burglary?

Lawyers who take settlements might be seen as committing “legal burglary.” They take money that doesn’t belong to them. It’s hard to prove they meant to do it. Defense lawyers might argue the actions don’t fit the legal definition of burglary.

How widespread is the problem of lawyers stealing settlements?

Lawyers taking settlements from clients seems to be getting worse. Many reports show lawyers taking money and breaking trust. This happens because lawyers have a lot of power over client funds and can make money by being dishonest.

What are some red flags that may indicate an attorney is engaging in settlement theft?

There are signs that might show an attorney is taking client money. Look for a lack of updates on your case and how your settlement money is handled. If your lawyer doesn’t share details or won’t show you financial records, they might be up to no good.

What steps can clients take to protect their interests if they suspect their attorney is stealing their settlement?

If you think your lawyer is taking your settlement, there are steps you can take. Keep an eye on your case and money, ask for detailed reports from your lawyer, and consider legal action or reporting them to the bar association. Getting advice from another lawyer can also help you figure out what to do next.

What are the consequences for lawyers who engage in settlement theft?

Lawyers who steal settlements face serious consequences. They might get sued for malpractice, face disciplinary actions, or even criminal charges. Clients who have been stolen from can try to get their money back and more through court. But, it’s a long and hard process, which is why it’s important to stay alert and take action early.