D.A. Gets Tough on Corrupt Lawyers

Times Staff Writers

As Chin Shan was dying of misdiagnosed stomach cancer, she sought justice from Leonard Samuels, attorney-at-law. The Los Angeles lawyer had won Shan a $190,000 settlement against the doctor who failed to diagnose her illness.

Then Samuels stole her money.

Shan died before her former attorney's trial, but she testified tearfully in a videotaped deposition. A jury took just one hour to convict the 56-year-old lawyer, who traded a Rancho Palos Verdes home for a cell at North Kern State Prison.

"She felt humiliated," said Shan's daughter, Phoebe Ma. "She trusted him, and he turned around and stabbed her. Stealing from a woman who is dying of cancer is ridiculous."

Samuels is one of 16 attorneys convicted of embezzlement, forgery and other fraud-related crimes in the last three years who were pursued by a squad of Los Angeles County prosecutors charged with cleansing the legal system of lawbreaking lawyers. Eight additional cases are pending, and two dozen more attorneys are under investigation.

In a profession whose negative image often fuels more punch lines than prosecutions, the idea of attorneys being led away in handcuffs from high-rise offices draws cheers. The team has a 100% conviction rate. It is the only one of its kind in the state, according to the State Bar of California.

The crackdown reverses years of limited attention to what has long been considered a serious problem by the state bar, which can recommend disbarment for corrupt lawyers but doesn't have the authority to prosecute. The new approach has drawn statewide notice and support from victims' groups, legal organizations and judges.

"A bad lawyer who steals not only hurts his own clients, it hurts the whole profession," said Los Angeles County Superior Court Judge David S. Wesley, who supervises the county's criminal courts.

Los Angeles County has 52,000 attorneys, the vast majority of whom are law-abiding, but lawyers say their reputations suffer from corrupt attorneys' heinous crimes.

One Malibu attorney was convicted of forging signatures on checks to maintain his beachfront lifestyle, leaving his clients without enough money to pay their medical bills. Another lawyer was charged with pocketing $25,000 belonging to a teenager whose parents died in a car crash. A San Gabriel attorney faces extortion charges for allegedly threatening to expose a man falsely accused by a dinner guest of poisoning her food.

Dist. Atty. Steve Cooley formed the unit, part of the Justice System Integrity Division, shortly after his 2000 election. The three prosecutors receive support from dozens of investigators, some former FBI agents and narcotics officers.

A corrupt lawyer betrays his position of trust in the legal system, Cooley said.

"Attorneys, the vast majority who are ethical, honest and upstanding, want to see thieves disbarred and prosecuted," he said. "I think the attorneys don't want to have their professional reputation tarnished by a few criminal miscreants."

The unit has drawn some criticism. Some victims have complained that the sentences are too light; convicted attorneys can avoid prison sentences if they pay full restitution. Others contend that prosecutors should focus on lawyers from large, big-moneyed law firms rather than solo practitioners. But overall, the unit has been well-received.

"It seems everybody knows a dirty attorney," said Deputy Dist. Atty. William Penzin.

The crimes committed run the gamut, but embezzlement appears to be most common, Penzin said.

Corrupt attorneys steal from the elderly, disabled and terminally ill. Many of the convicted attorneys handled estates or personal injury claims. With access to trust accounts, they looted the funds and spun elaborate ruses to keep clients in the dark, prosecutors said.

They spent the money on speculative investments, private school educations for their children, gambling debts and lavish lifestyles. More than a few struggled with debts from shrinking practices, so they robbed one client to pay another.

"Nobody has written any checks to Mother Teresa," said Ed Miller, one of the unit's prosecutors.

Agua Dulce attorney Bruce Nahin used his client's money to bankroll his horse ranch.

From 1998 to 2000, Nahin, 50, swindled nearly $2 million from nine clients, including two elderly women who lost their life savings. By the time Nahin finished writing himself checks, the trust account, which once held $573,000, tallied just $8.49.

Wanting to use Nahin's assets to pay restitution to victims, authorities considered seizing about one dozen of Nahin's horses. But they were too late. The Peruvian Paso Fino horses, some of which cost $50,000, were undernourished and deemed worthless. Nahin, who pleaded no contest to the charges, is in county jail awaiting sentencing and could receive a 10-year prison term.

Nahin's case, like many, was referred to investigators by his former clients.

In the cases that have reached trial, juries have not been sympathetic to defense arguments after hearing from victims such as Ramon Villanueva.

Villanueva was one of four disabled accident victims who testified that their former attorney, James Herman Davis, stole millions of dollars after settling their accident claims. Davis, who had an office in a downtown Los Angeles skyscraper, was known as the F. Lee Bailey of the civil law arena.

During his trial in 2001, one victim after another wheeled up to the witness stand. Many said they couldn't afford medical care or rehabilitation because Davis stole their money. Some of his victims couldn't speak English. Villanueva, 53, who was paralyzed after being struck by a car while riding his bicycle, said Davis pilfered most of his $500,000 settlement by forging his signature.

"He was a fraud," Villanueva said in a telephone interview. "I needed the money to provide food for my family. I didn't have anything."

Davis never admitted that he took the money. His defense was that the payments had been delayed because of accounting and other problems with the trust accounts.

But prosecutors said Davis, a 73-year-old former Los Feliz resident, spent much of the money on oil investments. A jury convicted him of grand theft, and he is serving a 12-year sentence at the Men's Colony in San Luis Obispo.

Before Los Angeles prosecutors began working closely with the state bar investigators, problem attorneys often slipped through the cracks of law enforcement. Many cases didn't meet criminal prosecution threshold levels -- prosecutors used to file embezzlement cases only if the figure was greater than $25,000. And the complaints were often misperceived as disputes over lawyers' fees.

Nationwide, attorney discipline issues are usually handled by the courts or state bar associations, which refer criminal cases to prosecutors. Specialized units dealing solely with attorneys are rare, according to the National Organization of Bar Counsel, a group for members of attorney disciplinary agencies.

Investigators said they were frustrated by the way it was done before. "We would send cases [to prosecutors], but they wouldn't go anywhere," said John Noonen, a state bar investigator. Now, he said, crooked attorneys are more likely to end up behind bars.

Faced with their own financial records as evidence -- the paper trail is often the most damning and insurmountable evidence -- most accused lawyers plead guilty before trial. The lawyers often can't explain the discrepancies, saying only that they intended to repay their clients.

Many victims also no longer feel shortchanged by a system that simply let a crooked attorney lose his license. Under the old system, even when attorneys stole entire life savings, victims rarely received more than the $50,000 provided by the state bar's client security fund.

In Shan's case, compensation from the security fund helped pay for her funeral.

The 62-year-old Taiwanese immigrant was forced to keep working as an insurance clerk through her illness to pay for chemotherapy. As she was dying, prosecutors videotaped a deposition in which she detailed how Samuels stopped returning her calls shortly after he settled her malpractice case for $190,000.

The guilty verdict came five months after Shan's death. A Superior Court judge sentenced Samuels to two years and four months in state prison.

At the sentencing hearing, Samuels admitted he took the money and accepted responsibility for failing his client.

"It hurts more than I can express to the court," he said. But, he said, "there were unusual circumstances in this case" because Shan's daughter owed him fees for representing her in unrelated cases.

Prosecutor Miller urged the judge to put Samuels behind bars as a message to all attorneys.

"We're not some old boys' club who looks out for each other," he said.

Copyright © 2019, Los Angeles Times
EDITION: California | U.S. & World
60°