Posts Tagged ‘fraud’

More Paralegal Crimes

Tuesday, April 3rd, 2012

After a little span marked by the absence of paralegal crimes on my news feed, I find two such stories today.

There is an inherent conflict in the role of paralegals. On the one hand they are expected to be reliable, responsible, self-starting individuals able to work independently of hands-on direct monitoring. On the other, they are supposed to work under the supervision of an attorney. The extent of the necessary supervision is open to discussion and has been discussed here several times. However, without offensive to the thousands of honest paralegals, that supervision really ought to include regularly double-checking and auditing of accounts under the charge of the paralegals as this story indicates:

Ex-Pima County paralegal pleads guilty in fraud case

Kim Smith, Arizona Daily Star Arizona Daily Star | Posted: Monday, April 2, 2012 12:02 pm

A former paralegal with the Pima County Attorney’s Office pleaded guilty to two counts of forgery with intent to defraud Monday in Pima County Superior Court.

Brenda Pinckney could be placed on probation by Judge Michael Miller next month or she could receive a prison term of between 1 1/2 and 7 1/2 years.

Pinckney, who worked for 12 years at the Pima County Attorney’s Office, was indicted Jan. 5 on charges alleging she stole more than $4,000 from the office – money intended to reimburse crime victims and witnesses for travel to Pima County Superior Court and per diem costs.

She faced 19 felony charges including fraud, theft, forgery and aggravated taking the identity of another person.

As part of her job, Pinckney, 36, was responsible for obtaining funds from petty cash and giving them to the witnesses.

Pinckney was accused of submitting reimbursement requests for nonexistent addresses and for court events that didn’t happen, according to a letter notifying Pinckney of her impending termination. She was also accused of not returning the required receipts or forging the signatures of victims and witnesses on the receipts she did return.

Some of the receipts were for travel from as far as San Jose, Calif.; Hermosillo, Sonora; and Page.

On Monday, Pinckney admitted submitting false reimbursement forms for travel to and from Yuma and Flagstaff for more than $442.

The key here is probably the fact that she worked in the office for 12 years and played off the trust she had built up over those years.

The next story is not so easy to fathom. First there is no indication as to why the alleged prepetrator is being labelled a “paralegal” and there is little indication as to what the “paralegal’s” role was in the scheme. But we have seen the phenomenon before. In all likelihood there is a split in this cases. In some the paralegal is a knowing, willing, and perhaps avid participant because of their inherent character. But I also suspect there are a fair number of paralegals who start out honest, but become involved in schemes hatched by attorneys or other persons in power over the paralegal out of fear of saying “No,” desire to please, or lack of understanding of the import of what they are being asked to do. In any case, here’s the second story of an alleged paralegal crime.

Massachusetts Paralegal Charged in Property Mortgage Scam

 

(Source: IRS) – MARCH 30, 2012 – BOSTON – A paralegal was charged late yesterday in connection with a multi-year, multi-property mortgage fraud scheme.  Rebecca L. Konsevick, 40, of Roslindale, was charged by Information with bank fraud and money laundering.

The Information alleges that from 2006 through 2008, Konsevick committed fraud in connection with condominium sales in Massachusetts. It is alleged that a developer identified multiple-family buildings for sale, recruited straw buyers to purchase the buildings and that the developer and others then recruited straw buyers to purchase individual units in buildings that the developer controlled.

According to the Information, the straw buyers’ financing for the purchases was obtained by falsely representing key information to lenders. The developer and others allegedly caused loan applications containing false representations regarding the buyers’ income, employment, assets, and/or intention to reside in the condominiums to be submitted to mortgage lenders. In addition, Konsevick and the developer caused HUD-1 settlement statements to be submitted to the same lenders, falsely representing that straw buyers had paid funds in connection with the property transactions, and falsely representing how the proceeds of the mortgage loans were disbursed. It is further alleged that Konsevick falsely signed certifications on these HUD-1 settlement statements and closed the relevant property deals.

If convicted on the bank fraud counts, Konsevick faces up to 30 years in prison to be followed by five years of supervised release and a $1 million fine. If convicted of money laundering, Konsevick faces up to 10 years in prison, to be followed by three years of supervised release and a $250,000 fine.

Dirty Dollars

Friday, August 6th, 2010

The news continues to be peppered with reports of paralegals being convicted of fraud or other crimes because they become mixed up in schemes with the attorneys for whom they work. Just a couple of days ago a Connecticut paralegal admitted a role in a mortgage fraud scheme in this report:

David B Fein, United States Attorney for the District of Connecticut, announced that HEATHER BLISS, 35, of Norwalk, pleaded guilty today before United States District Judge Janet C Hall in Bridgeport to one count of conspiracy to commit wire fraud stemming from her participation in a mortgage fraud scheme. According to court documents and statements made in court, BLISS was employed as a paralegal for a real estate lawyer in Wilton and, in that capacity, had responsibility for preparing and maintaining all legal and bank documents related to real estate transactions handled by her employer.

These reports frequently lead me to rant about who gets to call themselves paralegals and questions regarding whether we need a way to screen for character as they do in some parts of Canada. But today I’d rather focus on the paralegal’s reaction to illegal or unethical conduct on the part of the attorney. Apparently this paralegal reacted by becoming involved.

This issue has been addressed here several times, When Paralegals Work for Dishonest Attorneys and Handling Unethical Attorney Conduct for example. Today’s food for thought though comes from a post on the Paralegal Today listserv thread discussing raises:

I recv’d an 18% raise last year but ended up quitting earlier this summer because it was dirty $$. Lots of questionable illegal and unethical things going on in that office. I just took on a new job at considerably less per hour, but good, solid attorneys whom I can trust. The new job is worth every penny.

Sometimes this is the only real way to handle these situations. I applaud this paralegal for her choice.

One word changes paralegal to felon.

Sunday, March 28th, 2010

The word is “fraudulent” as in “Dubin served as the settlement agent for the vast majority of the fraudulent loans obtained in the course of the scheme. In that capacity, she organized closings, prepared documents, and disbursed the fraudulently obtained proceeds to various defendants.” PRNewswire.comreports on the paralegal’s sentencing: three years in prison, three years of supervised release, 3 years forfeiture of $7 million and payment of approximately $11.6 million in restitution.

Unlike other instances of paralegals involved in crime, this is not a case of a rogue paralegal harming clients and their employers through lack of attorney supervision. Dubin appears to have been just on member of a large conspiracy of the type that always amazes me. According to the report, “Of the 27 defendants charged in this case (United States v. Aleksander Lipkin, et al.), 25 pleaded guilty; one of the defendants, attorney Alexander Kaplan, 35, of Brooklyn, New York, was found guilty following a jury trial and is scheduled to be sentenced on April 6, 2010. ”

The amazement does not come from the number of defendants. It comes from the sheer display of greed on the part of the participants. These are all lawyers and others who are highly educated and likely to make significant amounts of money – more than most people will ever see – if they employ their skills and talents in an honest way. Instead they choose to feed their own greed without a thought for the hundreds of distressed homeowners who lost the titles to their homes and faced eviction. And apparently thought they would never get caught! They were not suffering from alcoholism or depression, and this was not a one-time slip. They were simply dishonest and greedy on a huge scale. And now they are convicted felons.

No profession is free from such “bad apples.” This scheme involved lawyers, a paralegal, loan processors, mortgage brokers, real estate appraisers, and loan account executives. Other schemes have involve doctors, accountants, chiropractors, etc. That, however, does not make other members of the profession feel any better about the stain on the profession or the harm done to the people the profession hopes to serve.

This Does Not Help the Profession’s Image

Friday, October 2nd, 2009

It is disappointing and frustrating to read so often of paralegals involved in fraudulent schemes with their attorneys. In the minds of many members of the public each such incident tends to counterbalance dozens of instances of service by paralegals to the community and the legal system. Here is one from Massachusetts reported at UPI.com. In this case, unlike another mortgage fraud case discussed here, the paralegal appears to be a major participant if the facts alleged are true:

A Worcester, Mass. grand jury indicted an Oxford, Mass. attorney and three accomplices late last week for a complicated scheme to defraud desperate homeowners facing foreclosure and mortgage lenders in real estate transactions involving distressed properties following an investigation by the office of Massachusetts Attorney General Martha Coakley.

Named in the indictments handed down September 28 were Allen Seymour, 41, and Raymond A. Desautels III, 43, both of Oxford; and Jason Passell, 51, and Judith Piette, 44, both of Worcester.

Seymour faces multiple counts of forgery, uttering, inducing a lender to part with property and larceny. Desautels, a former real estate lawyer, now disbarred, is facing multiple counts of inducing a lender to part with property; Passell, a real estate paralegal, is charged with forgery and multiple counts of uttering; and Ms. Piette, a notary public, faces multiple counts of filing a false written report by a public officer.

The scheme itself is complicated and the details do not matter much to the point here, but you can read them by clicking the link above.

One wonders on what basis this man was qualified as a “real estate” paralegal. On the one hand, it seems to lend credence to the argument for licensing and regulation. On the other hand, the attorney was regulated and was still part of the scheme.