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#124 What is the Client Security Fund?

mp3 #124 Can the Client Security Fund Help You? (mp3 file)

This message will discuss the following questions:

1- What is the client security fund?

2- What kind of losses are covered?

3- Can you receive your fees back?

4- Who can apply?

5- Who decides whether an application will be paid?

6- What other steps should you take?

7- How can you apply?

What is the client security fund?

The fund is a public service of the legal profession in California. In 1972, the State Bar of California sponsored legislation to create the fund in order to compensate clients who lose money due to a lawyer's dishonest conduct. Every lawyer in the state contributes to this fund.

What kinds of losses are covered?

Basically, the fund can reimburse you up to $50,000 for thefts by a lawyer. It covers money or property lost because a lawyer was dishonest, but it does not cover losses when the lawyer acted incompetently or failed to take a certain action. To qualify for the fund, you must be able to show that the money or property actually came into the lawyer's hands.

The fund does not pay any interest, nor does it pay for any damage done as a result of losing your money. For example, if a lawyer takes money that should have been used to prevent a foreclosure on your house, the fund can repay you for the lost money, but not the lost house.

Can you receive your fees back?

The fund will reimburse fees only in limited cases. If the lawyer did no work, fees may be covered by the fund. Fees are not reimbursable simply because you are dissatisfied with services, or because the work was not completed.

For example, if the lawyer consulted with you, and/or appeared in court on your behalf, prepared correspondence, or reviewed and filed documents for you, your fees may not be reimbursable under our rules.

Who can apply?

Almost anyone who has lost money due to a lawyer's dishonesty can apply for reimbursement. You do not have to be a United States citizen.

However, if you are the spouse or other close relative of the lawyer in question, or the lawyer's business partner, employer or employee, or a business controlled by the lawyer, the fund will not pay you reimbursement. Also, the fund will not reimburse for losses suffered by government entities or agencies.

Who decides whether an application will be paid?

The client security fund commission decides whether you qualify for reimbursement from the fund, and, if so, whether part or all of your application will be paid. The commission is made up of seven volunteers - four lawyers and three non-lawyers appointed by the State Bar Board of Governors.

What other steps should you take?

Since you will need to prove that the lawyer dishonestly took your money or property, you should register a complaint against the lawyer with the lawyer discipline system, if you have not already done so. For a complaint form, write or call toll-free: intake unit, State Bar of California 1149 South Hill Street, Los Angeles, CA 90015, telephone: 800 - 843-9053

Also, depending on the circumstances, you may be able to take the lawyer to court or make criminal charges against the lawyer. Since the law does not allow the State Bar to give you legal advice, you may want to consult another lawyer about these matters. If you do not know a lawyer who can help, call a lawyer referral service in your area; the services are listed in the yellow pages of the telephone directory. There are deadlines for starting.

How can you apply?

For an application form, write or call toll-free: the client security fund, the State Bar of California 1149 South Hill Street, Los Angeles, CA 90015, telephone: 800 - 843-9053.

The process is simple and free, and there is a staff to assist you. You do not need a lawyer to apply, but you may hire one if you wish.

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