Lawyer Admits Guilt in Elaborate Fraud Plot : Insurance scam: Experts say the case is emerging as one of the largest criminal prosecutions of attorneys in U.S. history.

A Woodland Hills attorney who wanted to be a judge instead went before one in San Diego on Friday to admit criminal involvement in an elaborate insurance fraud by a group of Los Angeles-area lawyers.

Bruce Ficht, 39, pleaded guilty to a single count of mail fraud, becoming the fourth attorney convicted in a case experts say is emerging as one of the largest criminal prosecutions of attorneys in U.S. history.

The four lawyers and two other people convicted thus far all lived or worked in the San Fernando Valley. Prosecutors have said 10 or 15 more attorneys could be indicted in the case, which has targeted a ring of lawyers whom prosecutors have called the “Alliance”.

No sentencing date was set for Ficht on the mail fraud count, which carries a maximum penalty of five years’ imprisonment and a $250,000 fine. Although Ficht’s plea bargain was sealed by U.S. District Judge Judith N. Keep, the agreement is believed to require Ficht to surrender his license to practice law.

Ficht declined comment after his brief court appearance, and Assistant U.S. Atty. George D. Hardy would not discuss specifics of Ficht’s plea. But Hardy said that “with all of these cases we’ve required that the attorneys surrender their licenses.”

In an interview with The Times more than a year ago, Ficht denied any wrongdoing and bristled at allegations of misconduct. “Between you and I, I have hopes one day of running for judge,” he said.

But, on Friday, barely speaking above a whisper in response to questions from Keep, Ficht admitted conspiring with other lawyers to manipulate litigation and bilk insurance carriers. “In furtherance of that scheme, I assisted in billing insurance carriers and assisted other attorneys in billing insurance carriers,” he said.

Ficht and those previously convicted described a sort of legal franchise operation, in which senior members of the ring set up new members with their own law offices, creating additional billing centers for the group. The new members were loaned start-up funds and sent insured defendants, and in return agreed to pay the group a percentage of their insurance company billings.

Ficht told Keep he struck such a bargain with Marc Kent, a former Studio City lawyer who has become a key government witness since pleading guilty last October. Kent helped Ficht set up his law office in November, 1986, and sent him clients in three complex litigations in which others in the group were involved, known as the Amgo, Syndico and Mint Financial cases.

Ficht said he took advice and direction from Kent, even though his Syndico client and Kent’s had adverse interests.

Richard A. Banks, who pleaded guilty last month, and Alan M. Hersh, who pleaded guilty in December, also said they were recruited by Kent.

Kent, in turn, said Lynn B. Stites, whom authorities called the mastermind of the scheme, recruited him in about 1984. Stites, who has not been charged, has refused requests for interviews.

The lawyers appeared together in a number of complex civil cases in San Diego, Los Angeles and Orange that usually involved claims of investment fraud. These were a special type of case in which insurance companies had to pay legal bills but lost the right to pick their policyholders’ lawyers or direct defense strategy.

Once in a case together, the lawyers allegedly used exhaustive discovery to run up defense bills, and filed cross-claims, or secondary lawsuits, against one another’s clients, increasing each attorney’s workload and defense bills.

Although it did not figure in Ficht’s plea Friday, Wayne Watson, a businessman who was sued in the Amgo case in San Diego and secretly worked with federal investigators said that Ficht once offered to pay him $300 a month to drop his Amgo attorney and retain Ficht to conduct his insurance-paid defense. Other defendants in the case were receiving payments from their attorneys, Watson said.

“It just slapped me upside the face as to being very blatant . . . what they were doing here,” Watson said in an interview.

Ficht, who denied Watson’s account of the conversation in a 1988 interview, ended up with another Amgo defendant.