Sunday, April 29, 2012

Lawyer Scams!

Lawyers have a well-deserved reputation for sleaziness.  But like all good scams, most of them prey upon the greed of the Mark.   If you get ripped-off by a sleazy lawyer, chances are, it was because you engaged him.

There are a lot of Lawyer scams out there these days.  Lawyers promise to make you rich beyond your wildest dreams - or get you out of a sticky legal problem.   And most folks fall for this - thinking that a lawyer can defy gravity and bend the law in their favor - or get them a lawsuit judgment that will make them a millionaire.   It is greed - on the part of the client - that usually gets the client in trouble.

What sort of scams are out there?  There are many:

Immigration Attorneys:  A friend of mine who used to be an immigration attorney turned me on to this one.   During the Reagan years, he had a booming business with the "amnesty" provisions they passed (yes that Regan, although the GOP today would dispute that Ronald Regan ever granted immigrants amnesty).   In more recent years, however, if you are here illegally, you have to return to your home country and then apply for a Visa.   As a result, his business tanked, and he closed his shop.

Other Immigration Attorneys were not so easily dissuaded.   As my friend tells it, a Mexican family comes to him, distraught that their friend will be deported.   He tells them kindly that there is nothing he can do - there will be a hearing and shortly thereafter, their friend will be on a bus back to Mexico.

A hour later, the client calls him.  "You are not a very good Attorney!" they say, "We found another Abogado (attorney) to take our case, and he says he can represent our friend at the hearing and stop him from being deported!"

My friend tries to warn them, but they are taken in by a slick Attorney who tells them what they want to hear - that they can win a case that is a slam-dunk for the prosecution.    And only for the low, low fee of $5000.   Where they get the money, I do not know.

So what happens?  The Lawyer keeps the $5000, the client is deported to Mexico, and life goes on.  Pretty slick racket - as your clients can't complain to the State Bar - they have been deported.

Social Security Disability Attorneys:  These folks advertise a lot these days, promising to "cut the red tape" and help you get full Social Security Disability!  They will "fight for you" to get what is right!

What is the catch?  They take 30% of "past owed" disability payments, and then rack up the bill by delaying recognition of your disability.  Rather than "cut through the red tape" they create as much as possible.

If they can delay your qualification for Social Security Disability by several years, then they can collect tens of thousands of dollars in legal fees.   And doing this is not hard - they submit applications that are intentionally incomplete or flawed, and then when they are rejected, they tell the client that "Those bastards at the Social Security Administration are being hard-asses" but of course, they will re-submit the application, with new evidence!

One client confided to me that he finally went to his local Social Security Office and talked with a case manager.  She said, "Let's just toss all this crap your attorney sent into the garbage and fill out a new form, and you will have your benefits within two weeks."

And of course, in two weeks, he got his first Social Security check, which included three years of back-payments, which the law firm wanted 30% of - for doing nothing.

Personal Injury Attorneys:   Personal Injury and Med/Mal Attorneys advertise heavily on billboards, particularly in Florida.  "We will FIGHT for you!" they say, often with their sleeves rolled up and their pathetic Lawyer biceps showing.   But who they fight for is themselves, of course.

How does it work?  Well, they might actually get a bigger check from the insurance company, but after they take out their 50-60% commission plus another 20% in "expenses" you are lucky to get anything at all - and what you do get is often less than the insurance company offered in the first place (or what you could have gotten from then directly, with a little negotiation).

For example, a friend of mine was run over on his bicycle.  It seemed like a pretty open-and-shut case, and the insurance company offered to pay his medical bills plus $100,000 for pain and suffering.

He hired a lawyer, figuring his months in the hospital were worth more than that.   They weren't.   After three years of pre-trial discovery and maneuvering, the insurance company offered to settle for $50,000 on the eve of trial.  The attorneys recommended this settlement and took most of the money.  My friend got nothing.

The pattern used by many of these sleaze-artists is the same.  They convince the client that a lawsuit will be like winning the lottery - turning the legal system into a Casino and playing on the Casino Mentality that pervades in our society.   And there are just enough obscene jury verdicts to convince a patsy - I mean client - that they will "win big" for their skinned knee, that they agree to go along with this.

But most people don't win millions at trial (which is usually reduced severely on appeal).  In fact, most of these cases never go to trial, but are settled, as my friend's was, usually long before trial.  The insurance company pays out a little more, to be sure, but most of that is taken by the Lawyer.  The client ends up with less than the insurance company's initial offer.

But like with the Casinos, the PI and Med/Mal Attorneys make sure that there are lots of headlines for big payouts - so the suckers, er, clients, believe that they too, someday, will win it big at litigation lottery.  They won't.  The Lawyers will.

Tax Attorneys:  Again, you've seen the ads - "We'll stop the IRS from slapping a lien on your business!" they claim.  So you send them $10,000 or $20,000 and...... they do nothing.

The IRS continues with its legal process, but instead of getting legal representation, you get bubkis.  Like with the Immigration Attorney, there is little you can do if you run afoul of the IRS.  There is no magic "get out of jail free" card, if you don't pay your taxes.

So you pay a lot to this lawyer and you still have accounts attached, tax liens filed, and wages garnished.   And if the attorney is clever enough, he tells the client, "Well, it would be a whole lot worse, if you didn't have me around!"

And the client gives him his blubbering thanks.

The reality is, of course, if you just engage the IRS and figure out what you owe, you can work out a payment plan.   But if you have not been paying taxes for several years because your business is failing (and you should have closed it ages ago) there is nothing a lawyer can really do for you, other than to recommend a Bankruptcy Attorney.

Bankruptcy Attorneys:  Again, this kind advertises heavily.   They promise to do great things, and may even have claimed to filed papers for you.   But many of them do nothing, but let your financial situation get worse and worse.

The worst of the lot are quasi-legal law firms, either claiming to be lawyers or having one lawyer on staff.  They tell you to send your debt payments to them to be placed in "escrow" while they "negotiate the debt".   They do nothing other than take your money and your creditors go through the usual legal channels to foreclose or repossess.

You end up broke and destitute, the Attorney ends up rich.   Nice deal, eh?

* * * 

The list goes on and on, of course.  In every area and practice of law, there are Attorneys and Lawyers interested more in lining their own pockets than in working to the advantage of their clients.   And in part, this is an inherent problem with the Attorney-Client relationship.  As one wag once put it to me, "The Attorney-Client relationship is, in and of itself, a conflict of interest!"

Simply stated, it is to the Attorney's advantage to drag out every legal proceeding for as long as possible, to insure the highest possible rate of return - in terms of billings.  What is in the client's best interest is often not in the Attorney's.   Professionalism, in a nutshell, is in the ability to see the difference between these two interests, and advising the client what is in their best interests, regardless of what is in the Attorney's best interest.

There are good lawyers out there  - and bad ones.   And the same could be said of Dentists.  Some recommend costly procedures that make a lot of money for the Dentist and do little to help the patient.  It is incumbent on the patient to find a good Dentist and think critically about proffered services.

The same is true of the legal profession.   When a lawyer promises astounding legal outcomes, a client should be skeptical.   And staying away from such attorneys is not hard to do.

Attorneys are now allowed to advertise on billboards.   And like anything else heavily advertised, it usually is a raw deal.   The best Attorneys - the ones who really give a damn - don't advertise much.   They get their referrals from word-of-mouth alone.  Their phone never stops ringing, even though they are not on the television or on a billboard.

The ones who advertise on the billboards?  They need a steady stream of business, because none of their clients will refer business to them.   And the more they advertise, the chances are, the sleazier they are.

Again, the best deals in life sell themselves.   And anything hyped or promoted should make you wary.   Think of it as Police tape marking off a crime scene, with the warning "bad deal ahead!"

The other way to stay out of these traps is to stop thinking that life is all about something-for-nothing - that you are going to get wads of unearned cash just because someone hit your car in an intersection.   Because chances are, it ain't gonna happen.  Sure, they will take your money, and you can be the friend with the perpetual problem, as you regale your friends about "your case" and what an injustice it is that you ran a red light and that cheap insurance company won't pay off!

Like with anything else in life, a lot of the control of these situations is in your hands, and far from being a passive victim, you do have choices you can make.   If you believe in something-for-nothing, chances are, you will make bad choices and end up bitter, angry, depressed, and poor.

This is not to say there are not valid cases out there - and good Lawyers.   But insurance companies recognize a good case, and in most cases, it doesn't take much to get a claims limit settlement.  And there are a few cases where a good lawyer gets a good settlement for a client.   But even then, the lawyer takes a lion's share of the dough.   There aren't in this for social justice, no matter what John Edwards tries to tell you.

Avoiding lawyer scams isn't hard to do.   Don't be greedy.  And never, ever buy anything advertised on a billboard or on the television (or radio), period.

1 comment:

  1. Note: A lot of the people who advertise on television and promise to help you with tax problems aren't even attorneys!


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