News and Information
September 06, 2018

VSB Reimburses Virginians over $100,000 for Losses Caused by Lawyer Misconduct

The Virginia State Bar, through its Clients’ Protection Fund, distributed $103,130.58 to 27 people who suffered financial losses because of the dishonest conduct of a Virginia lawyer during the last fiscal year.

Recipients include a woman whose Loudoun County attorney took $6,500 in fees but did very little work in a divorce case. The fund reimbursed all the fees. The Disciplinary Board suspended the attorney’s license as a result of the divorce client’s complaint. 

In another case, a lawyer who died in 2016 misappropriated the settlement proceeds earmarked for beneficiaries in a wrongful death case in Scott County. The fund reimbursed the one beneficiary who applied to the fund. The fund paid the beneficiary the amount the Scott County Circuit Court authorized in its approval of the settlement. To date, the fund has reimbursed more than $29,134 to clients of the deceased attorney. 

In its largest single disbursement of the year, the fund paid $25,810 to a Warrenton couple to reimburse them for fees they paid to an attorney for consumer credit work that was not performed. The fund also paid $9,490 to two other clients of the Fredericksburg lawyer. The lawyer’s license was suspended for one year with terms for misconduct associated with her consumer credit practice. 

The fund also approved the claim of a client of a disbarred Fairfax lawyer who never gave the client the client’s portion of a personal injury settlement. The fund paid the client $7,333.33. The attorney’s license was revoked in 2011 in a discipline case unrelated to the personal injury case. 

The fund also continued to approve claims to former clients of a Woodbridge attorney who was disbarred in 2015. Three payments totaling $6,700 created a to-date amount of $167,331.12 paid out to more than two dozen people cheated by the attorney for situations in which the attorney took fees but did very little substantive work for the clients. 

A chart of the fiscal year’s disbursements is available in the August issue of Virginia Lawyer magazine.

The Virginia State Bar has a strong disciplinary system for reprimanding, suspending, and disbarring lawyers who violate the strict standards of Virginia’s ethics rules. However, the bar recognizes that a disciplinary system alone is not enough. The VSB maintains the Clients’ Protection Fund to reimburse persons who suffer a financial loss because of dishonest conduct by a Virginia lawyer, which can include a deceased attorney’s not having sufficient trust account funds on hand at the time of his death to make required refunds to clients. The fund also reimburses clients who have suffered losses because of the actions of an attorney whose license has been suspended because he or she suffers from an impairment that affects the fitness to practice law. Awards from the fund are discretionary and are not a matter of right. The fund is intended to be a remedy of last resort for persons who cannot obtain reimbursement from other sources.

The Clients’ Protection Fund is made possible by an annual assessment paid by every active Virginia lawyer. In 2018, the Supreme Court of Virginia lowered the assessment from $25 to $10 because of an analysis that the fund has a sufficient balance to meet current and future claims. Disbarred lawyers and those suspended for more than a year must repay the Clients’ Protection Fund for any payments made to their defrauded clients before they can be considered for reinstatement of their license.

Updated: Sep 06, 2018