Thievin’ with Impunity: $282 Million Reasons Why Lawyers Are Immune from Criminal Prosecution in USA

LOS ANGELES (CN) — Southern California attorney Daniel Stephen March is more than likely headed toward disbarment, after the California State Bar placed him on involuntary inactive status on Tuesday, following accusations he misappropriated as much as $282 million from up to 60,000 clients.

“The level of March’s misconduct and misappropriation of client funds is stunning,”

said California State Bar Chief Trial Counsel George Cardona, in a written statement.

“March completely betrayed his responsibilities as a lawyer and his sworn oath of service to his clients and to the profession. Given the scope of his offenses, the just outcome in this case is disbarment.”

March’s firm, Litigation Practice Group, specialized in debtor’s rights.

Tens of thousands of clients hired the firm to invalidate their debts, for which they paid a flat fee in monthly installments.

The firm promised clients a full refund if their debts were not invalidated.

According to the California State Bar’s notice of disciplinary charges, filed in February, March’s firm collected between $78 and $282 million in fees from 40,000 to 60,000 clients in a little more than four years, between November 2019 and March 20, 2023.

The money was not kept in a client trust account, as required by law.

Where the money went is unclear.

March and his firm filed for bankruptcy in March 2023, declaring under oath that of the $282 million in revenue that his firm had taken in, all that was left was $4,500 in cash.

At one point March also testified that

“no money, nothing was held on behalf of the client.”

March initially denied the charges leveled against him by the state bar, but later withdrew that response.

The State Bar Court recently granted a default judgement against him.

In 2021, March won a $1.365 million settlement on behalf of one of his clients, which he, according to the state bar, failed to notify the client about, despite the client’s “repeated inquiries regarding the status of the funds.”

March “willfully and intentionally misappropriated” the money, which is deemed, by the state bar, to be “an act of moral turpitude, dishonesty or corruption.”

March is also charged with employing a twice-disbarred attorney, Tony Diab, to manage client funds.

But according to an investor in a federal lawsuit filed in January 2023, there is some indication that Diab was the real driving force behind LPG.

It was Diab himself who “founded the LPG law firm in California one month after his disbarment in Nevada,” they wrote, transferring his old practice into the new one.

“At some point after LPG’s inception, attorney Daniel S. March assumed the roles of President and Secretary of LPG,”

the investor said in the complaint.

“Although March appears to be the only licensed attorney employed at LPG, on information and belief, he does not exercise or retain control over the law firm … March is merely a figurehead used by LPG to conceal the fact that a disbarred attorney — Diab — exercises complete and exclusive control over the firm’s finances, IOLTA client trust account, operations and practice of law.”

The plaintiff also claims that Diab was

“diverting client-fee revenue and other assets to third parties in what appears to be an effort by Diab to transfer LPG’s tens of thousands of revenue-generating client accounts to another entity that has no obligations to [its investors], thus enabling Diab to expropriate the lion’s share of proceeds from LPG’s lucrative debt resolution business.”

According to plaintiffs in a class action filed in November 2023, Litigation Practice Group used a tactic known as “ringless voicemails,” leaving recording messages for people advertising the services of the “National Financial Hardship Loan Center.”

The phone number on the voicemail would redirect to the Litigation Practice Group, a firm based in Tustin, California.