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5 Times Lawyers Scammed Their Clients- And How Things Turned Out

Introduction

Advocacy is considered a noble profession, and advocates are one of the most responsible, privileged, and knowledgeable members of society. Their actions set an example for society and should be handled correctly. For litigants, their lawyer’s office becomes a frequent visit, and their lawyer is a vital part of their lives, as their lawyer’s performance, competence, and ethical goals have a significant impact on their freedom and happiness. 

However lawyers with poor moral standards are common in many countries, as indicated by the global spread of stinging jokes about them. Mario Puzo is not the only one who has referred to lawyers as ‘thieves’; many intellectuals have drawn analogies between them and those involved in illicit activities. Moreover, lawyers frequently warn that their profession is riddled with dishonest people who prioritise personal gain over ethical considerations. Therefore in such circumstances it becomes highly possible for the lawyer to scam their client and take advantage of the position they are in for their personal benefit.

Who is at risk? The client or the lawyer?

The customer vulnerability model provides a well-established theoretical foundation for professionalism. This approach is reflected and embodied in the legal profession’s legislation, which includes broad and dominating client protection safeguards as well as very limited third-party protections. This is undoubtedly obvious from the extremely broad and frequent conflict of interest rules intended to ensure that the lawyer is not tempted by their own or third-party interests to exploit the client’s weakness. The fundamental and primary rules are also client-protective, beginning with competence and progressing through communication, secrecy, and so on.

Mandatory Code of Conduct

In the Indian legal system, if a client intends to register a complaint against their lawyer, they cannot do so through the typical means of filing a complaint with the bar council. To fight the case, you will need to file a petition and hire a lawyer. Unfortunately, it appears that the lawyers have established this rule to benefit themselves. The bar council realises that if one lawyer fails to satisfy expectations, the client may be hesitant to choose another.

Therefore Section 49 of the Advocates Act 1961 empowers the Bar Council of India to develop rules governing standards of professional conduct, which elaborates on various duties of an advocate, such as the fact that the relationship between a lawyer and a client is highly fiduciary and it is an advocate’s duty to fearlessly uphold the client’s interests by fair and honourable means, regardless of any adverse consequences to himself or any other person.

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Five Times Lawyers Scammed Their Clients

1. Embezzlement of Compensation

The Patna High Court, in a recent case, urged the state bar council to take necessary action against lawyer Santosh Kumar Mishra for alleged misuse of Rs10.52 lakh in compensation funds awarded to his client couple following the death of their only child. The accused lawyer was arrested and is incarcerated for allegedly defrauding his client. 

On October 27, a panel chaired by Justice Rajeev Ranjan Prasad denied Mishra’s bail motion, alleging that he robbed his customers, henceforth playing on the trust that they placed in him based on his position. It was when the couple went to another lawyer to seek advice that they discovered three distinct cheques that were used to transfer Rs10.52 lakh from their bank account to the lawyer and his wife’s bank accounts.

2. Advocates suspended for their role in the rapid sale of property fraud.

Licenses of two solicitors who took advantage of the trust of vulnerable clients in need of money by participating in a dubious quick property sale scheme were terminated. Sisters Meena Kumari and Teena Banga were found irresponsible for failing to detect evidence of fraud and money laundering in dozens of transactions conducted between 2013 and 2017.

They “effectively and repeatedly ‘rubber-stamped’ transactions without the necessary rigour and attention to detail.” The theme running through the transactions was a lack of severe and critical advice that their clients were supposed to receive. The bar council also determined that neither lawyer conducted proper investigations into the transactions, properly advised their clients about the payments to third-party companies (they lacked “any real grasp or understanding as to why such payments were being made”), or obtained clients’ informed consent to make the payments. The council determined that both of them “breached the trust of clients and made them vulnerable by a combination of bad decisions, poor education, and a desire for quick money.”

3. Taking Excess money in the name of bribery

In Shambhu Ram Yadav v. Hanuman Das Khatry The Court upheld the Bar Council of India’s order dated July 31, 1999, wherein the appellant, who had been an advocate for 50 years, was anticipated to have bribed the judges. He admittedly requested an extra amount of Rs.10,000/- from his client under the pretext of bribing so that the order would be issued in the client’s favour. The advocate was thereafter suspended from practising law for the next three years.

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4. Luxury Litigation.

Unnecessary litigation, often known as luxury litigation, is legally prohibited by the bar council’s standards for lawyers, yet many lawyers continue to ignore this order, notably in divorce cases.

The lawyers also utilise intimidation tactics against the litigants, introducing them to other legal methods that are irrelevant or completely unnecessary in their case. They accomplish this by using their clients’ fury, greed, or ego.

5. Negligence as a part of scamming the client.

When an advance payment of the fee is made, there is a risk that the lawyer will do little to no work. This has become a major concern in the last year since a substantial percentage of foreclosure cases have included initial payments. In the United States, a client named Gladis Heras, like many others, contacted a lawyer last month to modify her mortgage. According to the Daily Business Review, the client’s bank was not contacted about the mortgage for several months, and the lawyer tried to prevent discussion. Fortunately, he was apprehended after facing multiple allegations of negligence and abandonment.

Conclusion

To avoid falling victim to personal injury lawyer scams, the clients should be proactive and educate themselves on the legal procedure. Being proactive and aware allows them to protect themselves and make sound judgements. Identifying red signs may help avoid personal injury lawyer fraud. They should conduct extensive research and verify the validity of any lawyer before hiring them. This article began with the assumption that certain underlying contradictions have a substantial impact on how we interpret and address issues concerning lawyers’ professional ethics. The longer these underlying assumptions stay implicit and unnamed, the less we will be able to make fully informed ethical decisions, whether at the level of a single action, rule formulation, or wider theory. 

However, keeping the code of conduct in mind will enable the practising lawyer to form a conceptual understanding, and consider remedies that work for their client and in their best interests.

References

  1. Stephen L. Pepper, Three Dichotomies in Lawyers’ Ethics (with Particular Attention to the Corporation as Client), 28 GEO. J. LEGAL ETHICS 1069 (2015).
  2. W. William Hodes, Cheating Clients with the Percentage-of-the-Gross Contigent Fee Scam, 30 HOFSTRA L. REV. 767 (2002).
  3. Marianne M. Jennings, Moral Disengagement and Lawyers: Codes, Ethics, Conscience, and Some Great Movies, 37 DUQ. L. REV. 573 (1999).

 

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