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A Tricky Email Scam and Avoiding Law Firm Malpractice

An Email Scam that Tricks Lawyers and Avoiding Malpractice

Ever get a promising email from royalty in a foreign land?  The would-be pen pal writes in such emails that he or she is due a large sum of money, and those who oblige to help recover it, will be rewarded by getting to keep a hefty sum of the total.

It seems nearly everyone has seen these scams, but Todd C. Scott, VP of Risk Management Minnesota Lawyers Mutual Insurance Company, says they are growing more sophisticated.  More worrisome, lawyers are “susceptible.”

Anyone, including a lawyer that responds to such messages, even if only to decline to offer service, will subsequently receive a flurry of emails, according to Mr. Scott.  These messages will redouble efforts with an emotional plea for help and provide supporting information that appears to speaks to the authenticity of the matter.

For those that take the bait, indeed a six figure check will arrive in the mail, with instructions to deposit the check in a trust fund – and begin distributing the funds while keeping the agreed upon fee.

Timing is an important factor in this scam and a lawyer will face pressure to act quickly.  Why?  Because a bank will inform an attorney that the account the check is written against indeed has “available funds” but the critical word an attorney should listen for is that the check has “cleared.”  Inevitably the check will be rejected and the attorney, having already distributed funds, is stuck with a loss.

8 Timeless Tips for Avoiding Malpractice

The story was Mr. Scott’s way of leading into his first tip in the second of a three-part CLE webinar series – this one on avoiding malpractice .  (The third is on Case Organization, Analysis and Presentation, June 16, 2015 at 2:30 p.m. EDT).

The tips he presented include:

1. Avoid trouble with trust accounting. New law firms can get by with off-the-shelf accounting software, but Mr. Scott recommends firms purchase software made for lawyers. Tools designed for lawyers manage unique requirements like trust accounting and often integrate with case management software.  In addition, he recommends law firm leadership be actively involved in the firm’s financial management and avoid risk-laden situations, for example, where the same person writing the checks is not also auditing the books.  He said firms with “high volume transactions” are especially at risk.

2. Simplify and automate client onboarding. This recommendation boils down to having solid law firm policies and procedures. It means having workflows and checklists in place from conflict checks to document storage and back up.  Mr. Scott points document storage isn’t just about losing paperwork anymore, it’s also about losing or misplacing mobile devices or flash drives with gigabytes of sensitive client data.

3. Eliminate the risk of missed deadlines. A missed deadline is a nightmare and Mr. Scott again makes a compelling case for legal specific software – the type that offers good docket control which is often beyond the capability of standard business software. For example, law firm practice management solutions enable law firms to customize templates that will provide a work-flow for entering the basic information at intake and then generating a list of action items while also updating the calendar.

4. Close the client communications gap. Some 15% of all malpractice claims can be traced to a break down in attorney-client communications according to Mr. Scott. He said failure to get consent, or disagreement with a lawyer’s tactic, are prime examples. In essence, these have less to do with a lawyer’s mastery of law, but rather stem from how a lawyer communicates.  A good firm keeps in touch with a client at least every 30 days he advised. “The first call you make ought to be the call you don’t want to,” he said attributing the wisdom to a mentor earlier in his legal career.  Invoices that are vague can also be a source of communications challenges – ambiguous entries such as “3.5 hours of research” probably don’t provide the level of invoice detail a client needs.

5. Follow real and virtual paper trails.  The pursuit of paperless offices in favor of digital storage may mean adages such as “nothing kills paper quicker than mold” are diminishing.  However, organization is more important than ever, said Mr. Scott.  Documentation and organized storage, whether in print or electronically, are the best mitigation strategy for clients prone to “misremember” conversations or events.  He relayed an anecdote of a small law firm that was destroyed by a fire: because the firm’s documents were backed up to the cloud the attorney had the mobility to work from anywhere.  Following the fire, that “lawyer’s job over the weekend was to find new space,” rather than frantically hunt for, repair or recreate files.

6. Establish a routine and adopt new technology. Some attorneys, he said, hand a “shopping list” to a member of a firm to go make technology acquisitions.  He believes attorneys need to be more involved than that:

  • Plan ahead and phase in technology over time – rather than all at once
  • Budget for services and support
  • Ensure the software will meet your needs and is compatible with other IT investments

7. When you grow, find tools that fit your firm. Leading edge, but not bleeding edge, was Mr. Scott’s recommendation on adopting new technology.  Lawyers should stick with proven technologies and more importantly those that will scale as a firm grows.  He suggested working with the software manufacturer or engaging a certified consultant, who will sit down and develop a workable plan.

8. Generate airtight documents. “Copying and pasting” is “risky and unnecessary” according to Mr. Scott, referring to the chances of mixing up client names or details when borrowing from a previous client document as a short cut.  As an insurance carrier, he prefers forms and templates to streamline document assembly.  File naming or file conventions too, which ties into his point about organization, ought to be consistent.  He also provided two tips for process:  All inbound documents are to be scanned and file accordingly immediately.  All outbound documents should be printed to PDF and saved.

* * *

Mr. Scott says he’s worked in the industry for more than 20 years and every time someone things they’ve see every conceivable malpractice claim, “something new comes along.” Statistics, he says, say if a new firm hangs out a shingle today, a lawyer can expect three malpractice claims over the course of a career.

“Malpractice doesn’t always mean a lawyer did something wrong,” he noted.  In fact, it’s not young or new lawyers that rack up the most claims – it’s those with 10-20 years’ experience that tend to get the most.  By that time in a legal career, those lawyers have a “long tail” – they’ve handled more cases by the time an attorney reaches his or her prime.

Don’t Miss this CLE Webinar

 Case Organization, Analysis and Presentation. Organizing, analyzing and presenting the key pieces of electronically stored information in even the smallest case can be daunting. How can you pull it all together—without pulling out your hair? Get tips, techniques and best practices at this information-packed and practical Webinar presented by three specialists in case analysis techniques and litigation technology.

Who:  Small law firm partners and administration
When: Tuesday, June 16, 2015 | 2:30 to 3:30 p.m. EDT
Cost:  Complimentary with registration
Where:  Online webinar, register here
Presenters:  Lauren Berry, Esq, of LexisNexis | David Cowenof The Cowen Group | Suzanne Dinsmoreof Day Pitney LLP

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The Business Case for Law Firm Practice Management ROI 

Photo credit: Flickr, zodman (CC BY-SA 2.0)

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About Frank Strong

Frank Strong
Frank Strong is the communications director for the LexisNexis software division located on NC State’s Centennial Campus in Raleigh. In this capacity, he leads communications efforts in support of software products for law practice and law department management and also litigation tools – across large law, small law and corporate counsel segments. With more than 15 years of experience in the high-tech sector, Strong previously served as director of public relations for Vocus, which developed marketing, PR and media monitoring software. He has held multiple roles both in-house with corporations, ranging from startups to global organizations, and has also endured the rigors of billable hours, having completed gigs at PR firms including the top 10 global firm Hill & Knowlton. A veteran of two year-long deployments, Strong has concurrently served in uniform in reserve components of the military for more than 20 years, initially as an enlisted Marine and later as an infantry officer in the Army National Guard. Strong holds a BA in Film and TV production from Worcester State University, an M.A. in Public Communication from American University, and an M.B.A. from Marymount University. He is a PADI-certified Master Scuba Diver and holds a USPA "B" skydiving license.