Philadelphia-Based Feds Have Ramped Up Prosecutions Against Lawyers
"I find these cases professionally offensive," said U.S. Attorney William McSwain of the Eastern District of Pennsylvania. "They're damaging to our profession. When you have lawyers taking advantage of people, especially their own clients, that is really reprehensible conduct."
May 20, 2020 at 02:41 PM
4 minute read
The region has seen a recent spike in prosecutions against misbehaving attorneys by the Philadelphia-based branch of the Justice Department, and it's no coincidence, according to U.S. Attorney William McSwain of the Eastern District of Pennsylvania.
In an interview with The Legal, McSwain, the top federal prosecutor for the Eastern District of Pennsylvania, acknowledged the rise in prosecutions against attorneys for white-collar crimes over the past year and a half and said he has made going after these lawyers a priority for his office.
Unlike a county district attorney's office, federal prosecutors have discretion to pick and choose which cases they deem most important. For McSwain, lawyers engaging in criminal behavior is particularly reprehensible.
"I find these cases professionally offensive," McSwain said. "They're damaging to our profession. When you have lawyers taking advantage of people, especially their own clients, that is really reprehensible conduct."
Most of the prosecutions involve attorneys ripping people off: take, for example, the case of Lehigh Valley lawyer Todd Lahr, who pleaded guilty to running a Ponzi scheme that duped his clients out of $2.7 million. Lahr convinced his clients to invest their money in a variety of business ventures, including a mining operation in Papua New Guinea, but instead used the money to pay his home mortgage, his child's school tuition, utility bills and other personal debt.
Or the case of Craig Cohen, of Blue Bell, an ex-White & Williams lawyer who was sentenced to five years in prison for scamming product manufacturers and class action settlements out of $3.4 million. Philadelphia personal injury lawyer Neil Mittin was sentenced to five years in prison and ordered to pay $3.4 million in restitution for collecting bogus referral fees.
John Kelvin Conner was sent to prison for gambling away an elderly client's savings. Conner, the client's power of attorney, made 176 unauthorized withdrawals at SugarHouse Casino in Philadelphia as well as the Borgata and Tropicana casinos in Atlantic City, totaling $95,000. His client's sole income was a monthly pension that went toward medical care and home assistance.
And so on.
McSwain said the cases are not just about fraud: "You have a lawyer who's supposed to be a trusted professional and who's held to the highest ethical standards and supposed to be leading the charge" for justice.
White-collar defense attorney and former federal prosecutor Linda Dale Hoffa said U.S. attorney's offices will typically pursue the most egregious cases to set an example.
"The amount of the [monetary] loss will not be a factor so much as an attorney doing a crime and abusing his special skill to commit the crime," she said.
Dale Hoffa added that it's not uncommon to see professionals of every stripe using their skills for criminal activity—and for that reason, the hammer comes down especially hard on them.
"Those with special skills like CPAs or doctors, they are particularly suited to commit crimes because of their special training, and it is viewed by prosecutors as an especially heinous crime. And they want to be clear, as a deterrent to others, that as a professional you are at a greater risk of being charged federally," she said.
"For these lawyers there will be very serious collateral consequences with the disciplinary board and they are at serious risk for losing their license," she added.
By the time a lawyer's misdeeds have reached the state's attorney disciplinary board, they've usually already been prosecuted.
The chairman of the board, James Haggerty, said the role of that organization is less about punishment and more about looking out for clients.
"The entire purpose of the disciplinary system is the protection of the public at large, not punishment of misbehaving attorneys," Haggerty said. "Everything we do is geared toward protecting the public. In order to do that, if that means recommending to the court that they suspend someone's license, then we'll do that."
He added, however, "The court does not look favorably upon any attorney who converts client money to their own use, and even less favorably upon lawyers who use their position to engage in such schemes."
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