CA State Bar’s Towery Is Next In Line to Perpetuate the Myth That the CA State Bar is Investigating & Disciplining Atty Loan Mod Fraud

Repeat after me: “The California State Bar is responsible for the victimization of 100s of thousands of California consumers in foreclosure that were defrauded by its attorney members.”

Instead of opening up the State Bar’s Client Security Fund (which was set up specifically to make restitution to consumers harmed by its attorney members), the California State Bar continues to string people along with erroneous tales of heroic feats of compassion for those consumers.

The goal??? The California State Bar hopes that all these folks will simply give up and go away. Not on my watch. Everyday the plot thickens with information thrown my way that corroborates the above facts and makes me more determined to see this through.

To find out more information about the Client Security Fund, see: http://www.calbar.ca.gov/Attorneys/LawyerRegulation/ClientSecurityFund.aspx

Could someone at the State Bar tell me why this information is not included on the Public Services page (see: http://www.calbar.ca.gov/Public.aspx).]

In order to find this information, you have to click on “File a complaint against an attorney”: then click on “Client Security Fund.” But how would the average joe know what the Client Security Fund is? They wouldn’t and that’s the whole point.
A year ago, I offered my assistance to the California State Bar and Robert Hawley (the self-appointed spokesperson of the State Bar’s Board of Governors) basically told me to pound sand.

See: http://erinbaldwin.com/2011/01/09/california-state-bars-howard-miller-bill-hebert-robert-hawley-board-of-governors-sweep-loan-modification-crisis-neatly-under-the-rug/

Prior to that I pled with Holly Fujie & Scott Drexel to no avail. Ms. Fujie even wrote me an email stating that she and Drexel were very well aware of the fraud that The State Bar’s attorneys were committing. That was two years ago and nothing has happened yet. Then Drexel was fired and Russell Weiner became Interim Chief Trial Counsel.

Then Howard Miller became President and Russell Weiner was famously quoted as saying how grateful he was that the California State Bar “caught the misconduct of its attorneys in time to save consumers from harm.”

And now it’s Chief Trial Counsel James Towery’s turn to perpetuate the myth that the California State Bar cares and is doing everything in its power to remedy the insolence and criminal conduct of its attorney members.

Here is the headline news story on the Cal Bar Journal. [Please note that our comments are in brackets.]

No let-up in loan modification complaints
By Nancy McCarthy

Staff Writer

Despite extensive efforts over the past two years to rein in improper loan modification activities by some lawyers, including legislation and aggressive prosecution by the State Bar and the attorney general, complaints from clients continue unabated.

[That's because your opening statement is a complete lie. Something can only be "abated" if action is taken.]

Chief Trial Counsel James Towery, who took over as the bar’s head prosecutor in August, said one-third of his office workload is devoted to loan modification complaints; 1, 500 investigations of 400 attorneys currently are active. Twenty have either resigned or been disbarred.

[Could we please have a list of the 400 attorneys that are being investigated so we can warn folks to stay clear? The statistic says "1, 500 investigations of 400 attorneys." So, on average the 400 attorneys being "investigated" have had 3.75 complaints against them. Isn't almost 4 complaints each sufficient to identify these attorneys as a precaution to prospective clients?]

“We’ve made tremendous strides but we haven’t stemmed the tide, ” Towery said. “The foreclosure crisis is so significant in California, and regrettably it has been an opportunity for a small number of attorneys to take advantage of people and try to get rich quick.”

[Wait a minute, didn’t you just say 400 attorneys are presently being investigated? Do you consider that a “small number of attorneys”? I know that there are 200, 000 members of the California State Bar and 400 probably seems like a drop in the bucket to you. But these are 400 attorneys specifically offering loan modification services. If you really want to help safeguard consumers in foreclosure, print their names.]

The foreclosure complaints are largely responsible for a 50 percent or more increase in the discipline unit’s work between 2008-2010, he said. Historically the office handles about 1, 500 investigations at a time. That number rose to 2, 500 in 2009, to 3, 500 last year and currently stands at 3, 200. “It’s been challenging for everyone, ” Towery said. “It’s like being in a district attorney’s office in the midst of a crime wave.”

[Considering the fact that the California State Bar is the largest self-regulating body, I would say that the number of complaints are increasing because the original complaints beginning in 2008 were never handled in the first place. Why do you mention the District Attorney? What does the DA have to do with the California State Bar investigation and discipline system?]

Despite the larger number of complaints and a steady number of calls — 6, 500 per month — to the department’s intake number, Towery said the discipline unit has made impressive inroads to its backlog numbers. The investigative backlog — cases older than six months — dropped from 911 in July 2010 to the current 390.

[Wait a minute, if you've received 6, 500 calls per month, why are there only 400 attorneys being investigated? What happened to the other 6, 100 complaints? We presume that there is overlap but even then, above you state that there are 1500 complaints about 400 attorneys. The numbers just don't add up.]

The number of cases in which the investigation is complete but notices have not been drafted declined from 1, 400 a year ago to 1, 163 last month.

[I want to make sure I have this straight: "The investigation is complete but notices have not been drafted." What the hell does that mean? Is that a statistic you are proud of? So, last year, you completed 1, 400 investigations but failed to draft notices on these investigations. But this year, you're doing so much better -- you've completed 1, 163 investigations but failed to draft a notice on these as well?]

And between 2007 and 2010, the number of cases resolved through warning letters, stipulations, closure or filing of charges doubled from 902 to 1987.

[I, for one, would like to see copies of the "warning letters, stipulations, closures or filing of charges" in 1, 987 investigations. The California State Bar is a public entity and there is nothing stopping me from filing a Public Records Act Request demanding this information. But why don't you save yourself the embarassment, and just print it on your website?]

In other words, Towery said, his office’s productivity increased by 75 percent between 2009 and 2010.

[For the love of Jesus, how do you figure that? See above.]

Towery took the top disciplinary job after 33 years in private practice, where he specialized in civil litigation with a focus on professional liability.

He served as State Bar president in 1995-96 after a year as chair of the board of governors discipline committee, overseeing implementation of recommendations to improve the efficiency of the discipline system.

["Overseeing implementation of recommendations to improve efficiency of the discipline system." I would love to see those recommendations and how James Towery implemented those recommendations. Because from where I sit California attorneys are running amok with no regulation whatsoever.]

His long interest in legal ethics issues led to the new job, which he described as the “best discipline job” in the country.

The large number of lawyers committing misconduct while handling foreclosure matters led to passage in October 2009 of SB 94, which prohibits attorneys from taking advance fees for work on loan modifications.

Although the statute was expected to curb abuses, many lawyers have either ignored the new law or tried to find ways to get around it, Towery said. “There is an irresistible impulse for a small group to take advantage of the plight of people in crisis, ” he said.

[James, there you go again with the "small group" reference: There is an irresistible impulse for a small group to take advantage of the plight of people in crisis. Of people ... do you mean of attorneys licensed and supposedly regulated by the California State Bar?]

Most of the misconduct involves charging clients small sums, offering promises of loan modifications and then doing little or no work. Some California lawyers also operate in other states where they are not licensed.

[You know what, now I'm getting really mad. The "small sums" might be small to you, James, but to these consumers in foreclosure $3, 500-$4, 500 was all they had left! You pompous son of a bitch. And not, some attorneys operated in states where they were not licensed, they all did.]

The discipline office is now receiving complaints from homeowners who may have hired a lawyer prior to the passage of SB 94 but are just now losing their homes. The investigations are complex, often involving multiple clients, many of them non-English speaking, and often involving subpoenas of bank records. “Twenty is not going to be the final number” who lose their law license, Towery said.

The discipline office also is receiving complaints about a somewhat newer scam: debt consolidation. Clients facing large debt pay their lawyer a certain amount of money every month believing the lawyer will pay down the debt. In fact, however, the lawyer simply takes the money.

[Wow, imagine that … I reported that on December 30, 2010: “Debt Relief Scams Have Taken Over Where Loan Mod Scams Left Off” (http://erinbaldwin.com/2010/12/30/debt-relief-scams-have-taken-over-when-loan-mod-scams-left-off/]

In addition to the ongoing loan modification complaints, Towery said the discipline office is focusing on three other areas: major misappropriation by lawyers of client funds; responding to the report of the Northern California Innocence Project (NCIP) that found what it said was widespread failure to pursue prosecutorial misconduct; and creating initiatives to divert low-level misconduct.

[Like Michael Ramos, Laura Robles. Melinda Spencer, Jonathan Robbins, and William Gale in the San Bernardino County DA's office?]

• The bar is trying to identify lawyers who take client funds early and fast-track their cases. Towery estimated between 30 and 40 lawyers meet the initial criteria of stealing at least $25, 000 from clients, and his office also will investigate lawyers who take less but have a prior history of misappropriation. Small teams of lawyers and investigators are working on major misappropriation cases in both Los Angeles and San Francisco and will act quickly to go to court to restrict a lawyer’s license if he or she poses a “substantial threat of harm” to the public.

[If an attorney poses a substantial threat of harm to the public don't you owe a duty to warn the public?]

Towery described major misappropriation matters as a “classic case” of a small number of lawyers causing a disproportionate number of problems. While the vast majority of lawyers are fundamentally honest, he said, “a tiny percentage has crossed that boundary line” and dipped into their client trust accounts. Towery said 42 percent of the claims paid by the Client Security Fund to victims of lawyer dishonesty are the result of major misappropriation and ratcheting up prosecution of these offenders will enhance public protection.

[If I hear the words "small number" again ... and that comment, "a tiny percentage have crossed the line..."]

[Hallelujah!! Towery states that 42% of the claims paid by the Client Security Fund to victims of lawyer dishonesty ... please let us know about the entire 100% because I am at a loss to identify even one client that has been paid one cent.]

The Nevada State Bar printed its Client Security Fund payments by attorney (including JAMES PARSA) - so why won't you?] See: http://erinbaldwin.com/2011/01/09/nevada-state-bar-paid-out-346000-in-claims-from-clients-harmed-by-its-members-why-wont-the-california-state-bar-follow-suit/)

• Towery’s office is analyzing approximately 130 cases the innocence project said were reversed because of prosecutorial misconduct. The office will not look at the matters identified by the report as harmless (not resulting in a reversal) because of the bar’s “clear and convincing” burden of proof. Towery suspects that bar prosecutors did not know about many of the reversals, either because the case was not reported, as required, or did not meet the criteria for notifying the bar. To improve the requisite reporting, his office sent 1, 900 letters to judges and is stepping up contacts with district attorneys’ offices to educate them about reporting requirements.

Towery said the bar is not looking at misconduct that occurred more than 10 years ago. Some of the more recent cases involved prosecutors who have died or were not licensed in California, some are now judges and others are misidentified. None of those can be prosecuted. A small number will meet the bar’s criteria for prosecution, he said. “Our approach is very simple — we treat prosecutors in an even-handed fashion.”

• Towery is creating an alternative diversion program for low-level misconduct matters, such as first-time DUIs. Lawyers with no previous record but minor complaints may receive a warning letter or have charges dismissed. “We hope it’ll be a learning experience for them, ” Towery said.

The Alternative Discipline Program, created for lawyers with mental health or substance abuse problems, “is problematic and we continue to closely examine it, ” [Yah, right.]Towery said. His office will adhere to an informal three-strikes rule, and lawyers who return to the discipline system “will no longer get the benefit of the doubt. The folks with prior records are going to be our focus.”

http://www.calbarjournal.com/February2011/TopHeadlines/TH6.aspx

http://erinbaldwin.com/2011/02/03/ca-state-bars-towery-is-next-in-line-to-perpetuate-the-myth-that-the-ca-state-bar-is-investigating-disciplining-atty-loan-mod-fraud/