Pennsylvania Lawyers Fund For Client Security Soon To Consider Possible $4 Million Payout To Partially Reimburse Ripoff Victims Of Now-Deceased Attorney; Fund Recently Green-Lighted $3.4 Million Payment To 31 Clients Of Another Lawyer Currently Doing 15-Year Prison Term For Unrelated Fleecing

In Hummelstown, Pennsylvania, PennLive.com reports on the struggle former clients of now-deceased attorney Jeffrey Mottern are having trying to recover at least some of the $11.3 million Mottern swindled from them. An excerpt:

• [B]ecause lawyers are involved and they charge fees, Mottern's victims know they stand no chance of getting all of their money back. But many hold out hope of recovering some of it – if not in their lifetime, at least in their heirs'.
  
  Aside from the pending lawsuit against Ameriprise and the two local banks, there is a pending claim filed with the Financial Industry Regulatory Authority's Office of Dispute Resolution to try to recover money from Ameriprise.
  
  An arbitration hearing on that claim is scheduled to begin Aug. 22, which if successful, could help to partially cover victims' losses.
  
  Then there's the the Pennsylvania Lawyers Fund for Client Security, a fund that exists to provide financial relief to individuals who file claims alleging a financial loss as a result of actions by a Pennsylvania licensed lawyer.(1) It is funded through $45 of the $200 lawyers pay annually to keep their law license active in Pennsylvania.
  
  Like the court system, it too is a slow process and claims are reviewed in the order in which they are received.
  
  The fund caps each claimant's award at $100,000 and has a $1 million aggregate cap on claims made against any single lawyer, although there is a provision that allows the fund's board to ask the Supreme Court to waive that cap for cases involving catastrophic losses if the fund's resources allow.
  
  Such a waiver was recently granted in case involving former Gettysburg lawyer Wendy Weikal-Beauchat, who pleaded guilty to stealing more than $6.3 million from clients. She is serving a 15-year prison sentence. Next month, the fund will begin paying out over two fiscal years a total of $3.4 million to Weikal-Beauchat's 31 victims whose claims were approved, said the fund's executive director Kathryn Peifer Morgan.
  
  The Mottern victims' claims are the next ones to be evaluated that could require a court waiver to the fund's $1 million aggregate cap, she said.
  
  "The board is going to be looking at that at our September board meeting and evaluating when would be the appropriate time to start addressing it, given our financial resources," she said.
  
  Fifty claims have been filed by Mottern victims alleging a combined loss of $14.9 million. Peifer Morgan said some of the claims are seeking reimbursement of the fictitious interest that Mottern claimed their original investment had earned, but the fund is not permitted to cover that part of a loss.
  
  Given the $100,000 cap on an individual victim's award and assuming the $1 million cap is waived, Peifer Morgan estimates combined, the fund's maximum payout to Mottern victims would be a little over $4 million.
  
  Despite the large claims that victims of lawyers' misdeeds have filed with the fund seeking relief in recent years, Peifer Morgan said the number of lawyers stealing clients' money that come to the fund's attention represent less than 1 percent of all lawyers admitted to the Pennsylvania Bar.
  
  Moreover, she said the number of victims' claims the fund received in the fiscal year that ended on June 30 is down from the prior year "so that's encouraging."
  
  But to many of Mottern's victims, the experience they had with an attorney they entrusted with their nest eggs left a sour taste in their mouth when it comes to lawyers.
  
  [Ken] Felty is one of them. "I don't trust lawyers. I don't trust trusts. I don't trust anybody that wants to invest my money," he said.
  
  [93-year old Kathryn] Swartz, on the other hand, said she does have faith in the lawyers who are trying to recover money that she and other victims lost in Mottern's scam.
  
  As for Mottern, she said, "I don't have any good thoughts about him."

For the whole story, see Dead Hummelstown lawyer's investment scam continues to haunt victims.

Go here for other stories in connection with this attorney's ripoffs.

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(1) For similar "attorney ripoff reimbursement funds" that attempt to clean up the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (now includes a listing for Canadian client protection funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.