Massachusetts Lawyers Defraud Clients of Two Million Dollars

The Massachusetts Clients’ Security Board announced that it had awarded over $2,000,000 to clients that had been defrauded out of their money by 33 lawyers committing legal malpractice in Massachusetts. A program run under the Massachusetts Bar Counsel since 1975, the CSB receives 12.49% of attorneys’ annual registration fees to fund reimbursements. The Board is made up of seven lawyers appointed by the Massachusetts Supreme Judicial Court; they receive no compensation for their work, however, there are investigators and staff who work full time for the Board.

Three lawyers accounted for payments of $1.07 million, or over 50% of the total payout. Those lawyers are: Raymond J. Paczkowski, a real estate attorney responsible for $509,392 in reimbursed claims; Harley H. Anderson, a trust and estates attorney whose one client was reimbursed in the amount of $253,279.64, the largest award if the fiscal year; and Harold Meizler, another trust and estates attorney with one client being reimbursed for $250,000.

Mr. Paczkowski was disbarred on November 24, 2010 after he converted a $109,953 real estate transaction for his own use. The Board of Bar Overseers found numerous irregularities in his accounting, however, it seems that it was the theft that sparked the investigation and necessitated the sanction.

Mr. Anderson was indicted and subsequently plead guilty for embezzlement by a fiduciary and larceny. He received a two-year jail sentence for his crimes.

Trusts and estate lawyers accounted for 43% with a payout of $891,000. Real estate lawyers accounted for 30.5% or $629,000. Massachusetts’s personal injury lawyers accounted for 12.10% of defalcation. In upcoming payouts, according to the CSB Assistant General Counsel Karen O’Toole, is with a Massachusetts bankruptcy lawyer , Robert Mangano, who took monies from clients in the Lawrence and Lowell area and failed to file for Massachusetts bankruptcy relief. The victims here are often unable to retain new counsel and may loose their homes as a result of the Massachusetts legal malpractice.

The largest category of claims was “unearned retainer” claims, which accounted for 36 of the 63 awards by the Massachusetts Clients’ Security Board, with a value of $125,685. At the end of the year there remained $14,073, 090 in outstanding claims.

The law does not have any statute of limitations, like Massachusetts personal injury law, and Massachusetts negligence law, victims are encouraged to report any suspicious activity to the Massachusetts CSB. Victims need not retain counsel for processing a claim, as the CSB will do all of the work for victims when clients’ money is stolen. To get to their website, click on Massachusetts Clients Security Board to go right to the form. Victims should be pleased to note that the CSB has over $5 million in reserves to make up for potential large hits.
We urge the pessimists among our readers to acknowledge that notwithstanding all of the above, the 33 lawyers responsible were out of 55,269 practicing lawyers in Massachusetts.
We also want to distinguish legal malpractice from theft. In Massachusetts legal malpractice there is a statute of limitations, and is not usually theft. Further, there is no CSB to investigate and return moneys.
In our detailed study, Getting In Trouble: The Severe Sanctions; 2008-2010, we review all of the sanctions received by lawyers in those years. That study, published on our website, was geared towards lawyers, to give an in depth view of the types of cases resulting in attorney discipline. We reviewed all 116 such cases.
We also published a study entitled Massachusetts BBO Admonitions Study 2008-2010, which reviewed all of the admonitions, or lessor penalties given out by the Board of Bar Examiners. Both studies are worthy reading for Massachusetts lawyers and Massachusetts clients.