Question: What options are available for clients who lose money from a lawyer’s wrongdoing?

Answer: History has shown legal professionals have the means to violate their clients’ trust while in possession of escrow money.  For lawyers embroiled in personal or financial dire straits, the threat of losing a license may not deter against misappropriation of clients’ funds.  To protect clients, the Board of Bar Overseers collects money from all Massachusetts licensed attorneys and maintains a security fund available to compensate aggrieved clients.

According to the State’s website, http://www.mass.gov, the Client Security Board is comprised of attorneys authorized to “grant money to a member of the public who has suffered a financial loss only when the financial loss was caused by a defalcation”.   A defalcation is defined as theft, embezzlement or misappropriation of property held by an attorney in trust for his or her legal clients.  The funds can compensate in cases of attorney resignation or death as well.

The Client Security Board is prompt to point out the limitation to the funds uses.  “There is no defalcation where a client disputes the fee charged by his attorney, or where a client believes the legal services rendered by his attorney were inadequate, negligent, or incomplete.”

Clients typically first seek Board of Bar Overseer involvement to prove their claims against defalcating lawyers through disbarment or disciplinary actions.  After the lawyer is investigated and disciplined, a claim can be made with the Client Security Board for monetary relief.

Though it may take a year, the Board will financially compensate a victim in most reasonable cases.  After paying a claim, the Board aggressively seeks repayment from the lawyer by filing a civil lawsuit and seeking criminal restitution orders.

Attorney James Haroutunian practices real estate law, estate planning in Billerica at 790 Boston Road. Contact him with questions at 978-671-0711, hlawoffice.com or email him at james@hlawoffice.com.

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