Woodbridge lawyer steals $4 million from clients, prompting Virginia State Bar to consider “Payee Notification”

After a Prince William County lawyer stole millions of dollars from clients, the Virginia State bar is reconsidering a Payee Notification Rule. Stephen Conrad settled hundreds of car crash, premises liability and other accidental injury cases and did not tell his clients. Furthermore, very few of this lawyer’s clients received notice that there was going to be money disbursed on their injury cases.

According to court documents and the FBI’s website, up until December 2007, Conrad primarily represented clients in personal injury cases and workers’ compensation claims. Conrad settled clients’ claims without their authority or knowledge by forging their signatures on release of liability forms and then providing those forms to the insurance companies against whom the claims were made. In many instances, the claims he mishandled involved serious injuries his clients had sustained, including spinal injuries, facial fractures, and, in at least one case, a leg injury that required amputation. Upon receiving checks from insurance companies, Conrad forged his clients’ signatures and misappropriated the funds that belonged to them. Conrad concealed from his clients that he had settled their claims by telling them that the cases were still ongoing.

According to the American Bar Association, payee notification measures deter lawyer misconduct, protect clients, and benefit client protection funds. They have proven inexpensive public protection tools with little burden on insurers or lawyers. Because of concerns that insurance companies might communicate improperly with represented parties, the Virginia State Bar is considering limiting the notice to a copy of the cover letter or other evidence of payment, sent at the time the payment is mailed to the claimant’s attorney. Details can be found at the Virginia State Bar public website. See tomorrow’s post by Herndon and Reston injury and disability lawyer Doug Landau, where he explains the procedures used by ABRAMS LANDAU, Ltd. to avoid the problems Conrad’s clients experienced.

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