Lawyer helps client engage in fraud - what we do about it?

March 24, 2007 3:39 PM

Can I sue a lawyer who helped his client commit financial fraud against my dad?

A man who scammed my dad used the services of a lawyer who knew that he was helping draft fraudulent contracts. We know this because the same lawyer previously worked for the same scam artist against another elderly person. But how can we sue the lawyer? What steps do you recommend? Can we sue for the money that he helped scam? I know it is against the ethical rules for a lawyer to help his/her client engage in fraud, and would also like to have the lawyer disbarred.

posted by Kimpossible to law & government (12 comments total)

Usually individual claims for fraud, unfair business practices, etc. are brought under state law. (There are a very few federal laws that create private claims re scams, e.g. RICO, but most fraud claims are state law claims.) So the claims you have or may have would depend upon the state where the scam occurred, the evidence of the scam (and whether it meets the standards for whatever the state law prohibits), and the evidence linking the attorney to the scam.

Sorry, an "all depends" answer.
posted by ClaudiaCenter at 4:10 PM on March 24, 2007

Assuming you're in the United States, the first step would be to find your state's Bar Association and contact them with the details of the fraud that he was involved with.
posted by Rhomboid at 4:14 PM on March 24, 2007

I'm guessing that you won't be able to get the same damages twice (once from the fraudster, once from the lawyer). You're also going to have to prove that he knew what he was doing.
posted by oaf at 4:17 PM on March 24, 2007

(The lawyer.)
posted by oaf at 4:17 PM on March 24, 2007

IANAL. Finding a lawyer to file suit against another lawyer is tough. You can pursue professional action directly with the bar association, but absent a previous record of complaints and accusations which are sufficiently credible to corroborate yours, you've an uphill battle on your hands.

Assemble documentation, including the contracts in question. File complaints for fraud with the police. Collect whatever investigative reports they produce, that you can, and cooperate with the police in the prosecution of criminal charges. If criminal charges can be preferred, that is your best initial recourse.

If criminal charges are not forthcoming, after you file a complaint, and your complaint is investigated by the police, consider the difficulty of your position. If you are still bent on pursuing the issue, interview the Better Business Bureau about the attorney in question, and any ventures in which he has interests that align with your scam artist. Consider hiring a private investigator from another locale, to assemble further documentation, and interview witnesses and participants in the fraud.

Present your evidence to any attorney who shows interest, if you can bear the expense of a civil prosecution (low to mid 6 figures, for a minimal case). Or, to the bar association in his practice state, if you can't. Unless your case is extremely well documented, and compelling, be prepared for not much to happen. If it is, prepare to settle monetarily, without prejudice to the attorney's status with the bar.

Generally, unless a criminal case is made, it is tough to get an attorney disbarred.
posted by paulsc at 5:47 PM on March 24, 2007

if you can bear the expense of a civil prosecution (low to mid 6 figures, for a minimal case)

This is not really accurate. You have (possibly) a lawsuit with two defendants, scam-guy and scam-guy's lawyer. The claims against scam-guy's lawyer are likely going to require some additional evidence that you'll won't need for the claims against scam-guy.

Your ability to find an attorney, and what that will cost, really depends upon many factors, including the evidence, the extent of the loss, and the wealth of the defendants. The fact that one of the two potential defendants is a lawyer may or may not matter.

When a case seems very strong to a plaintiffs' lawyer, they may take the case on contingency. This usually means that you pay out-of-pocket expenses and at the end of the case they take a percentage of the recovery. For an individual case, the out of pocket expenses can range from a few hundred dollars for a filing fee and the case settles, to $7,500 for a case that has a deposition or three and then settles, to tens of thousands of dollars (more with expert witness fees) for a case that goes up to the eve of trial or to trial. (Most civil cases don't go to trial.)

When a case seems less strong, the attorney may seek to take the case and charge an hourly rate (plus out of pocket expenses). Sometimes the client can negotiate a cap on the fees. Again, the amount that would be paid to the attorney for fees and costs would depend upon when the case settles.

When an individual case goes through fact discovery, motion practice, expert witness discovery, and pre-trial procedures, it is true that the the attorneys fees for the plaintiff's side can be pretty high, and often more than $100,000 worth of fees. But that doesn't mean that the individual plaintiff is paying that level of fees out of pocket. If a case goes that far, it's usually a contingency case where the lawyer has decided that it makes sense to invest the time and get a cut of a larger settlement.

On the other hand, if a client is paying hourly fees out of pocket and there's no cap, usually the case settles earlier, because no individual (except someone really rich) could keep paying. Also, sometimes if the case is going well but the individual doesn't have the money to pay out of pocket any more, a new deal is struck mid-case.

In other words, there are just a lot of different factors which determine how much the individual plaintiff ends up paying. (Wow, I could have just said that, hun.) You won't know your situation with your father's case until you meet with different lawyers and get their take on the value of the case.

Be sure to research the lawyers you contact (and not by going by a friend's brother's "hey he's a nice guy" stuff). Contact your local chapter of the "trial lawyers" or the "consumer attorneys" (different phrases to describe plaintiffs' attorneys). Look at the publications or web site of the state or local chapter, and see which attorneys are featured in articles as having particular expertise, good results, and so on. Call those attorneys (who may be too busy and sought-after to take a "small" case) and get references. Good attorneys know other good attorneys.
posted by ClaudiaCenter at 7:26 PM on March 24, 2007

As I see it, there are two issues here. The first is that you want to recover your money. The second is that you're angry with the scammer's lawyer lawyer.

The actual scammer might not have any money, or he might be so slippery that it would be hard to recover your money from him. In that case you would have no choice but to try suing the scammer's lawyer. That isn't necessarily an easy thing to do: you (your lawyer) has to be able to come up with a theory under which the scammer's lawyer is responsible for your loss. The point of a contract is that it's an agreement between two people. The lawyer wasn't a party to the contract, so he's not directly responsible for the scammer's actions. What I'm saying is: don't insist on suing the lawyer just because you're angry with him. It may complicate matters and cost you money.

If the scammer's lawyer behaved unethically then you should do like Rhomboid said and contact your Bar association. You'll have more to show them if and when you win your case, but that doesn't mean you can't talk to them now. For the lawyer to be disbarred you'd probably have to show something more than the fact that he knew the scammer wasn't going to fulfill his part of the contract. Without knowing more details it's hard to say anything more, except that you will need to find a lawyer to advise you.
posted by Joe in Australia at 8:41 PM on March 24, 2007

Yes. If he knowingly abetted the fraud he can be sued for damages, perhaps criminally prosecuted and face loss of his professional license. Hire a lawyer to help you sort out your particular facts and how the law applies.
posted by caddis at 9:13 PM on March 24, 2007

IAAL, but this is not legal advice, yadda yadda yoo.

If it can be shown that the lawyer engaged in fraud and your father suffered damages as a result, there could potentially be a case against the attorney. You don't really say how you know that the lawyer did this, but I wouldn't recommend getting into this unless you have some substantial evidence that shows that the lawyer did this.

Also, this may or may not have been obvious: You most likely cannot sue (you would have no standing). It would have to be your dad and dad alone.

Lastly, the suit against the lawyer in which you could recover damages would be a suit under some tort theory of fraud. This suit, however, would not be able to be a part of disbarring or disciplining the attorney. That would only occur under a separate disciplinary action brought by the state's bar association or similar entity. You could, however, report the alleged conduct to the appropriate attorney discipline agency in the hopes that they will investigate and bring such an action.
posted by saladpants at 10:25 PM on March 24, 2007

You can't sue. Your dad can.

He can sue, but may not prevail.

If the money invovled is substnatial, it might be worth it. If not, do the math and see.

If you recover, you'll porbably have to share with your attorney.

Lawsuits are stressful. Until you have been in one, you have no idea. They take forever... or at least it seems so. If you can't find a lawyer to help on a contingency basis, you have to be well funded.

You may be able to interest a lawyer to take on your case if you join with the other 'scam' victim, the potential rewards are high enough, and the case is good.

If Dad lost less than a significant percentage of his wealth, you may find moving on is the better strategy. Dad learned something AND taught you a good lesson. It's not all a loss, just terribly unfair.
posted by FauxScot at 6:21 AM on March 26, 2007

Word of warning, when I left Florida in the beginning of this decade it had recently become a semi-scandal that lawyers were often responding to complaints against them filed with the Bar association by suing the complainant for defamation. You don't say where you are and I don't know if this is a practice that has extended past my home state but you could find yourself having to mount a serious proof rather than just filing a simple and quick complaint.
posted by phearlez at 11:57 AM on March 26, 2007

IAAL ... 3 words ... state bar association ... go eat him.
posted by jannw at 12:15 PM on March 26, 2007