Category Archives: Florida Supreme Court

Florida lawyer accused of “planning” Allied Veterans scam is reinstated nunc pro tunc after criminal charges were reversed

Hello everyone and welcome to this Ethics Alert which will discuss the recent Order of the Florida Supreme Court reinstating the license of a lawyer who had been charged with felony crimes for allegedly planning Allied Veterans scam and whose conviction was reversed.  The case is The Florida Bar v. Kelly Bernard Mathis, Case No.: SC13-2031 (Supreme Court of Florida, July 17, 2017) and the SC Order is here:  https://efactssc-public.flcourts.org/casedocuments/2013/2031/2013-2031_disposition_138842.pdf

As some of you may recall, an alleged financial scam involving an entity called Allied Veterans, based in St. Augustine, was in the media extensively a number of years ago.  The alleged scam involved gambling and “internet cafes”.  The lawyer had advised Allied Veterans that the internet cafes were legal and, after a law enforcement investigation, he was charged with planning the scam and with multiple felonies.  In 2013, Attorney General Pam Bondi said that the lawyer was the “mastermind” behind the alleged $300 million racketeering and money laundering scheme with internet cafes where people were actually illegally gambling.

Although 57 people were arrested, the lawyer was the only defendant who went to trial.  He argued that he was giving legal advice to a client and many lawyers were concerned about what that might mean for the potential criminal liability of attorneys who advise clients on a future course of conduct.  The former presidents of the nonprofit pleaded no contest and the former Fraternal Order of Police president and vice president pleaded guilty and faced no prison time.

The criminal prosecutors argued that, although Allied Veterans claimed that it was a nonprofit organization created to help veterans, it had only given about two percent of its profits to charitable causes.  The prosecutors also argued that the lawyer’s law firm had billed the nonprofit about $6 million for his legal services, although his lawyers stated the amount was most likely less than that and that he only billed for actual work his firm had performed.

During the trial, prosecutors presented testimony from witnesses who said that they had purchased hundreds of hours of internet time but never used it because they actually came to gamble. The lawyers wanted to argue in the lawyer’s defense that the lawyer had properly advised Allied Veterans that it was his opinion that offering a sweepstakes game that was legal under Florida law, which permits sweepstakes if they are used to bring a customer into a business that sells a legal product, such as McDonald’s sweepstakes.  The judge rejected their request to make that argument.

After his conviction on 103 criminal counts, the lawyer was sentenced to six years in prison.  He appealed and the Florida Fifth District Court of Appeals reversed the conviction, finding that the trial judge improperly prohibited his lawyers from arguing that the internet cafes were legal and not gambling.  The Attorney General’s office decided not to pursue charges against the lawyer after the conviction was reversed.

In disciplinary matter, The Florida Bar did not oppose the lawyer’s reinstatement and Fourth Judicial Circuit Chief Judge Mark Mahon issued a report in March 2017 recommending that the Florida Supreme Court immediately reinstate the lawyer.  In its July 17, 2017 Order, the Florida Supreme Court reinstated the lawyer nunc pro tunc to the date of his felony suspension in 2013.

Bottom line:  This lawyer was charged with multiple felonies and chose to go to trial instead of accepting a plea bargain which would not have resulted in prison time; however, the conviction would most likely have resulted in his disbarment.  After his trial in 2013, the lawyer was convicted and sentenced to 6 years in prison.  He was also automatically suspended because of the felony conviction.  Pursuant to the Florida Supreme Court’s July 17, 2017 Order, the lawyer was reinstated to practice nunc pro tunc to November 28, 2013, the date of his felony suspension.  The lawyer was ultimately suspended and unable to practice for over 3 ½ years for a conviction that was later reversed.

Disclaimer:  this e-mail is not an advertisement, does not contain any legal advice, and does not create an attorney/client relationship and the comments herein should not be relied upon by anyone who reads it.

Joseph A. Corsmeier, Esquire

Law Office of Joseph A. Corsmeier, P.A.

29605 U.S. Highway 19, N., Suite 150

Clearwater, Florida 33761

Office (727) 799-1688

Fax     (727) 799-1670

jcorsmeier@jac-law.com

www.jac-law.com

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Florida Supreme Court dismisses Florida Bar’s petition proposing substantial revisions to lawyer referral service rules

Hello everyone and welcome to this Ethics Alert Update which will update my August 1, 2016 Ethics Alert and will discuss the recent Florida Supreme Court Order (May 3, 2017) dismissing the Bar’s petition for approval of the proposed substantial revisions to the Bar Rules related to lawyer referral services.

The proposed rules would have substantially revised the current rules, changed the name of the referral companies to “matching services” and “qualifying providers”, specifically prohibited fee splitting and deleted the disclaimer that the entity is a lawyer referral service.  The proposed rules would not have limited ownership to lawyers only or referrals to lawyers only.

The case is: In Re: Amendments to the Rules Regulating The Florida Bar-Subchapter 4-7 (Lawyer Referral Services, Case No.: SC16-1470 and the Supreme Court’s Order May 3, 2017 is here:  https://efactssc-public.flcourts.org/casedocuments/2016/1470/2016-1470_disposition_138549.pdf

Under the proposed amendments, which were approved by the Florida Bar Board of Governors in 2016, any private entities that connect consumers looking for legal services with lawyers would have been called “qualifying providers” regardless of whether they were “traditional” referral services (such as ASK-GARY or 411 PAIN) or a technology-based provider (such as AVVO or LegalZoom).

The Florida Bar’s website has a page summarizing the proposed rule revisions as well as a frequently asked questions section and comparison chart.  The link to that page is here:  http://www.floridabar.org/proposedlrsamend#Overview.

The May 3, 2017 Florida Supreme Court Order states:

Previously, in In re Amend. to Rule Reg. The Fla. Bar 4-7.22—Lawyer Referral Services, 175 So. 3d 779, 781 (Fla. 2015), the Court rejected amendments to Rule Regulating the Florida Bar 4-7.22 proposed by The Florida Bar and directed the Bar to propose amendments that “preclude Florida lawyers from accepting referrals from any lawyer referral service that is not owned or operated by a member of the Bar.” In this case, the Bar proposes amendments to rule 4-7.22 that do not comply with the Court’s direction concerning lawyer referral services that are not owned or operated by a member of the Bar and that seek to expand the scope of the rule to include “matching services” and other similar services not currently regulated by the Bar. (emphasis supplied).

The Court having considered the Bar’s prior petition, the amendments proposed in this case, the comments filed, the Bar’s response, and having had the benefit of oral argument, the Bar’s petition in this case is hereby dismissed without prejudice to allow the members of this Court to engage in informed discussions with the Bar and those who are in favor or against the proposed regulation of matching and other similar services. The Court lacks sufficient background information on such services and their regulation at this time.

No rehearing will be entertained by this Court.

Bottom line:  As I previously stated, if approved by the Florida Supreme Court, the proposed revisions would have substantially altered the rules for lawyer referral services; however, the proposed rules would not have limited ownership to lawyers nor referrals only to lawyers.  This Order makes it clear that the that the proposed rules “do not comply with the Court’s direction concerning lawyer referral services that are not owned or operated by a member of the Bar and that seek to expand the scope of the rule to include ‘matching services’ and other similar services not currently regulated by the Bar.”

The Florida Bar will now ponder the language of the Supreme Court’s Order in considering potential future proposed lawyer referral rule revisions.  Stay tuned…

…and be careful out there.

Disclaimer:  this e-mail is not an advertisement, does not contain any legal advice, and does not create an attorney/client relationship and the comments herein should not be relied upon by anyone who reads it.

Joseph A. Corsmeier, Esquire

Law Office of Joseph A. Corsmeier, P.A.

29605 U.S. Highway 19, N., Suite 150

Clearwater, Florida 33761

Office (727) 799-1688

Fax     (727) 799-1670

jcorsmeier@jac-law.com

www.jac-law.com

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