S. Cal. Pro Athlete Attorney Pleads Guilty to Tax Fraud for Referrals

Hello, dear readers!

Have you ever wondered how applicants’ attorneys find their clients?  A good portion of them develop a reputation for solid work and zealous advocacy – they get repeat business and referrals.  Ask your favorite defense attorney for a recommendation for a family member and they will always have attorneys they can recommend that are both competent and ethical.

But not all files are thus obtained.  There’s always the rumors circulating around that this firm or that firm engages “cappers and steerers” to obtain more business.  Why do defendants care?  Because before an injured worker can say “I don’t want to file a claim” there’s an application on the books and half a dozen medical treatment liens, with the cappers collecting their headhunter fee and the defendants stuck with a procedural time to clean up that is both time consuming and expensive.

This process isn’t limited to small cases either – according to the San Diego Tribune, former Chargers player Ron Mix has plead guilty to tax fraud charges.  As alleged by the prosecutor involved, Mr. Mix gave money to a charity in exchange for referral of professional athletes to his workers’ compensation practice, and then deducted the charitable contributions from his taxes.

Now, bear in mind, dear readers, that this is not necessarily a “cappers and steerers” situation – attorneys frequently donate to charitable organizations, and the resulting attention from the community results in a certain degree of notoriety, which itself leads injured workers to beat a path to one’s door.

At the same time, while mere allegations of wrongdoing are no indication of wrongdoing, a guilty plea is such an indication.  After all, as your humble blogger’s old uncle Paddy used to say when I struggled with childhood pyromania, “you can hide the fire, boy, but whatchya gonna do with the smoke?”

As you will recall, sometime ago your humble blogger reported on AB 686, which would have expanded the scope of this behavior and its related punishments, but that bill has yet to grace the Governor’s desk for a signature.

Perhaps we the California State Bar or the WCAB rules should require a filing, by each attorney noticing his or her representation on a case, that the attorney swears, under penalty of perjury, that he or she has not “offered, delivered, received, or accepted any unlawful rebate, refund, commission, preference, patronage dividend, discount or other consideration, whether in the form of money or otherwise, as compensation or inducement” for any person or organization to refer the injured worker to that particular office.   Perhaps an amendment to Labor Code section 4906?

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