State Protection Fund Coughs Up $122K To Cover Client Losses From Illegally Pocketed Real Estate Closing Cash, Unearned Fees By Dishonest NJ Attorneys

The New Jersey Lawyers’ Fund for Client Protection recently announced:

• During the third quarter of 2009, the New Jersey Lawyers’ Fund for Client Protection, funded by the State’s lawyers and judges, paid $122,606.14 to clients for losses caused by 7 lawyers,(1) the Board of Trustees announced [...]. The Fund’s purpose is to pay on behalf of the honest majority of lawyers for the wrongdoing of the few who are suspended or disbarred for misappropriation.(2)

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• For a claim to be paid, the attorney against whom it is filed must have been a member of the Bar, acting as either attorney or fiduciary, at the time of the incident; and unless deceased, must have been disbarred or suspended from the Bar, or convicted of embezzlement or other misappropriation of property. An individual client can receive up to $400,000 (for claims arising after January 1, 2007, lesser amounts for claims arising prior to that date) and the Fund can provide up to $1,500,000 in claims against a given lawyer. Special permission can be granted by the Supreme Court to exceed the aggregate limit.(3)

For the announcement, see Lawyers’ Fund for Client Protection Releases Third Quarter Report.

(1) Go here for the list of the third quarter claim awards and status of each attorney under the Supreme Court discipline system. The Fund's findings involve improperly pocketed client money by attorneys derived from real estate closings, an estate settlement, and the dishonest retention of unearned legal fees.

(2) The Fund only covers client losses due to dishonest conduct by the attorney who is licensed in New Jersey. Cases involving legal malpractice and negligence are handled through Civil Court actions and fee disputes through the District Fee Arbitration Committees established by the Supreme Court.

(3) If a New Jersey attorney, either in the course of representing you or acting as a fiduciary, screws you out of money or property through dishonest conduct, go to the New Jersey Lawyers' Fund for Client Protection for information on how to recover some or all of your losses from the fund.

For other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.