Here’s a cautionary tale for PI lawyers: it’s a terrible idea – not to mention a crime – to stage motor vehicle accidents in order to file phony insurance claims.
Just ask the New Orleans attorney who has been indicted on federal charges of Conspiracy to Commit Mail and Wire Fraud. He and 32 co-defendants allegedly participated in a scheme to intentionally stage motor vehicle accidents with tractor-trailers and commercial vehicles in the metropolitan New Orleans area, according to a news release from the U.S. Attorney’s Office in the Eastern District of Louisiana. So far, 11 of the 33 indicted defendants have tendered guilty pleas in federal court.
The indictment charges the attorney with conspiring to defraud insurance companies, commercial carriers, and trucking companies. In the scheme, a co-defendant “referred staged accidents to [the indicted attorney] and other New Orleans personal injury attorneys referenced in the Indictment as Attorneys A, B, and C, for $1,000.00 per passenger for accidents involving tractor-trailers and $500.00 per passenger for accidents not involving tractor-trailers.”
The indicted attorney advanced thousands of dollars for these accidents and expected to receive a certain number of accident referrals based on the amount of money advanced, according to the news release. He represented 77 plaintiffs involved in 31 staged tractor-trailer accidents. Approximately $1.5 million was received in settlement of these claims, and he received approximately $358,000.00 in attorney’s fees, according to the release.
Read the news release from the U.S. Attorney’s Office here.
NC Rule of Professional Conduct 8.4: Misconduct
It is professional misconduct for a lawyer to:
(a) violate or attempt to violate the Rules of Professional Conduct, knowingly assist or induce another to do so, or do so through the acts of another;
(b) commit a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness or fitness as a lawyer in other respects;
(c) engage in conduct involving dishonesty, fraud, deceit or misrepresentation that reflects adversely on the lawyer’s fitness as a lawyer;
(d) engage in conduct that is prejudicial to the administration of justice;
(e) state or imply an ability to influence improperly a government agency or official;
(f) knowingly assist a judge or judicial officer in conduct that is a violation of applicable rules of judicial conduct or other law; or
(g) intentionally prejudice or damage his or her client during the course of the professional relationship, except as may be required by Rule 3.3.
Comment  Many kinds of illegal conduct reflect adversely on a lawyer’s fitness to practice law, such as offenses involving fraud and the offense of willful failure to file an income tax return. However, some kinds of offenses carry no such implication. Although a lawyer is personally answerable to the entire criminal law, a lawyer should be professionally answerable only for offenses that indicate lack of those characteristics relevant to law practice. Offenses involving violence, dishonesty, breach of trust, or serious interference with the administration of justice are in that category. A pattern of repeated offenses, even ones of minor significance when considered separately, can indicate indifference to legal obligation.
Comment  The purpose of professional discipline for misconduct is not punishment, but to protect the public, the courts, and the legal profession. Lawyer discipline affects only the lawyer’s license to practice law. It does not result in incarceration. For this reason, to establish a violation of paragraph (b), the burden of proof is the same as for any other violation of the Rules of Professional Conduct: it must be shown by clear, cogent, and convincing evidence that the lawyer committed a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness, or fitness as a lawyer. Conviction of a crime is conclusive evidence that the lawyer committed a criminal act although, to establish a violation of paragraph (b), it must be shown that the criminal act reflects adversely on the lawyer's honesty, trustworthiness, or fitness as a lawyer. If it is established by clear, cogent, and convincing evidence that a lawyer committed a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness, or fitness as a lawyer, the lawyer may be disciplined for a violation of paragraph (b) although the lawyer is never prosecuted or is acquitted or pardoned for the underlying criminal act.
Comment  A showing of actual prejudice to the administration of justice is not required to establish a violation of paragraph (d). Rather, it must only be shown that the act had a reasonable likelihood of prejudicing the administration of justice.
Read NC Rule of Professional Conduct 8.4 here.
Jay Reeves is author of The Most Powerful Attorney in the World. He practiced law in North Carolina and South Carolina. Now he writes and speaks at CLEs, keynotes and in-firm presentations on lawyer professionalism and well-being. He runs Your Law Life LLC, which helps lawyers add purpose, profits and peace of mind to their practices. Contact email@example.com or 919-619-2441.