A Double Standard for Lawyer Dishonesty: Billing Fraud versus Misappropriation

In 1 on February 5, 2009 at 10:48 am

In client surveys about their concerns about lawyers, excessive fees and dishonesty in billing practices are near the top of the list of client concerns. Empirical studies suggest that a majority of lawyers who bill by the hour engage in dishonest billing practices at least occasionally.

200 During the last decade, we have seen a fairly long list of high-powered lawyers go to prison and get disbarred for billing fraud.201 Even so, the American legal profession has as yet failed to insist that lawyers be truly candid with their clients about matters relating to the lawyers’ hourly fees. Most lawyers who mislead clients about billing issues or who withhold information that clients might want to know do so to serve their own and their partners’ financial self-interest. We need to draw clear lines that prohibit deception and that require disclosure.

Whatever the courts decide are the proper standards for discipline of lawyers who have taken client funds to which they are not entitled, those standards should be enforced in a fair and equitable way. Judge Schwelb correctly noted in his dissenting opinion in

In re Addams that justice is more likely if the analysis is more context-sensitive. He urges not every misappropriation of client funds is a hanging offense.202 Also, a court’s assessment of the seriousness of lawyer dishonesty should not turn on whether the misappropriation involves unauthorized removal of funds from a client trust account or unauthorized billing of a client for fees or expenses to which the lawyer is not entitled. Both involve stealing.

Lisa G. Lerman – Source

Posted via email from HKLaw Investigation


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