White-Collar Crime

Attorneys are federally indicted in claimed multimillion-dollar law practice frauds

The feds announced indictments this week against attorneys in two different states who are accused in claimed multimillion-dollar frauds concerning their law practices.

In Illinois, attorney, radio talk-show host, author and financial adviser Kathleen Niew, 57, is accused of bilking a suburban Chicago couple of $2.3 million, the Chicago Tribune reports.

The money went into Niew’s law firm trust account and was supposed to be used for commercial real estate transactions. However, the indictment says she put it to unauthorized use, for her own benefit, by purchasing interests in mining operations.

Niew, whose law license was previously suspended on an interim basis, has been recommended for disbarment by an attorney disciplinary panel. She now faces 10 counts of wire fraud in the federal criminal case, as well as ongoing civil litigation.

In South Carolina, in an unrelated criminal case, attorney William J. Rivers III has been federally indicted on three mail fraud counts, accused of working with his then-law partner over a six-year period to convert for their own use millions of dollars that should have gone to the firm’s personal injury clients or been used to pay their hospital bills. Court papers estimate that Rivers obtained around $3.3 million from the claimed fraud, reports the Morning News.

His former partner in the Schurlknight & Rivers law firm, John L. Schurlknight, committed suicide in November 2012.

Rivers was temporarily suspended from law practice the following month, News Channel 15 reports.

The indictment in Rivers’ case says he and Schurlknight, between 2006 and 2012, concealed from clients that their cases had settled, forged signatures in order to cash the checks and kept the money for themselves.

A class-action client lawsuit against Schurlknight’s estate is ongoing, and does not name Rivers as a defendant. It alleges that Schurlknight stole up to $10 million from 22 clients.

Another suit was filed against the bank which handled the law firm’s trust accounts, contending that it helped Rivers & Schurlknight misappropriate client money.

The articles do not include any comment from the indicted lawyers or their counsel.

See also:

ABAJournal.com: “Client suit says attorney radio host took $2.3 million and charged $20K more in legal fees”

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