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Immediate
Christine Morganti
(505) 797-6028
cmorganti@nmbar.org

$95K Paid to Wronged Clients

 

Albuquerque, N.M.—In 2009 the State Bar Client Protection Fund Commission awarded claims of $95,965.79 23 to clients harmed by the inappropriate activities of their attorneys.

 

There has been a marked increase in claims requested and claims made since the fund began paying clients in 2006. According to staff who administers the fund, the increase is due to an increased awareness of the fund by the public, an increased awareness of the fund by attorneys who take on cases to pick up the pieces for clients who have been harmed, and a growing connection with the Disciplinary Board, often the first organization clients contact to lodge a complaint against an attorney.

 

Claims in 2006 totaled $30,649 and grew to $884,072 in 2009; the amount paid totaled $12,099 in 2006, increasing to $95,965.79 in 2009.

 

Since there is a $10,000 cap per claim, the commission denied the amount over the cap on three claims in 2009. In addition, 11 claims were denied because after a required investigation, the commission determined that the attorney fees were, in fact, earned. The commission hopes to gradually increase the $10,000 cap.

 

Below is a chart of claims awarded in 2009.

 

Attorney

Claims Paid

Claim Amount Reimbursed

Nature of Claim

 

Anthony Romo

 

1

 

$1,400.00

    

    Failure to Refund Unearned Fees

 

Charles Marcus

 

5

 

$6,770.00

    

    Failure to Refund Unearned Fees

 

Dennis Martinez

 

1

 

$6,089.52

   

    Failure to Refund Unearned Fees

 

Donald Lepley

 

1

 

$10,000.00

   

    Theft/Conversion

 

G. Mitchell Baker

 

1

 

$2,214.43

   

    Failure to Refund Unearned Fees

 

Karl Werner

 

3

 

$3,284.50

   

    Failure to Refund Unearned Fees

 

Mary Kennedy

 

1

 

$3,670.30

    

    Failure to Refund Unearned Fees

 

Victor Sizemore

 

10

 

$62,537.04

   

    Failure to Refund Unearned Fees,  
   Hardship Exception and Theft

 

More comprehensive charts and statistics are included in the full 2009 report found at https://www.nmbar.org/Attorneys/CPF/clientprotectioncommission.html.

 

From 2005 to 2009, the Client Protection Fund was funded solely from late fees assessed on attorneys who did not meet their minimum continuing legal education requirements. Beginning in 2010, every attorney licensed to practice law in New Mexico is required by N.M. Supreme Court order to contribute $15 annually to the fund.

 

“This is an important step forward in providing long-term funding,” said Briggs Cheney, 2009 chair of the commission. Due to the increasing number of claims, long-term funding is an important step in ensuring the longevity of the fund.

 

The Client Protection Fund Commission has a duty to engage in other measures of prevention of dishonest conduct of attorneys and have supported the N.M. Supreme Court and the Public Regulation Commission efforts at new rules and regulations.

 

In 2009 the N. M. Supreme Court adopted a rule requiring attorneys to use banks that have agreed to notify the Disciplinary Board when attorneys overdraft funds from trust accounts created for the purpose of holding client payments for services until the work has been performed.

 

A pending rule before the Public Regulation Commission would require insurance companies to send letters notifying clients when checks have been sent to attorneys settling insurance claims. Some of the claims to the Client Protection Fund have come about due to attorneys forging client signatures, cashing the checks, or not informing clients that their insurance claims were settled. Whether the PRC will enact this rule should be known later in 2010.

 

“Thank you,” stated a grateful recipient of client protection funds. “Because of the money you gave me, I was able to save my house.”

 

To qualify for payment, the loss a client incurred must have been caused by the dishonest conduct of an attorney and shall have arisen out of a client-attorney relationship or a fiduciary relationship. Dishonest attorney conduct includes theft or embezzlement of money; the wrongful conversion of money, property or other things of value; failure to refund unearned fees; and borrowing money from a client without the intention or ability to repay. The claim has to be filed no later than five years after the client knew or should have known of the dishonest conduct of the attorney.

 

To file a claim, call (505) 797-6093 or 1-800-876-6227 or visit https://www.nmbar.org/Attorneys/CPF/clientprotectionfund.html for more information.

 

The State Bar Commission on Client Protection is a statewide body whose purpose is to promote public confidence in the administration of justice and the integrity of the legal profession by reimbursing losses caused by the dishonest conduct of lawyers admitted and licensed to practice law in the courts of New Mexico.