Wealthy lawyer who repaid with interest $800K stolen from clients gets probation in fraud case
Updated: An Arizona personal injury lawyer was already earning millions annually when he made what federal prosecutors termed an “inexplicable decision” to steal about $800,000, an average of $100,000 a year, from clients in vaccine cases.
That resulted in a loss of Jay Bansal’s law license but no prison time after he almost immediately repaid clients in full, plus 10 percent interest,” the Phoenix New Times reports.
The money Bansal initially took from clients was paid under the National Vaccine Injury Compensation Program, which does not permit contingency fees. A client discovered the problem when she looked through documents in her file and found she had been awarded $142,000, but was promised only $85,000 by Bansal.
He pleaded guilty in October to a single count of mail fraud and was sentenced on Monday to five years of probation, plus a $100,000 fine, the newspaper reports. He also agreed to give up his other cases and his license to practice law as part of the plea deal.
His disbarment is effective today, the article notes. It doesn’t include any comment from Bansal or his defense counsel.
Prosecutors Dominic Lanza and Peter Sexton said in a court filing that prison time might have been expected in a case like this, but pointed to the full compensation victims received and said Bansal’s fall from grace is punishment enough.
“In sum, Bansal will emerge from this process a disgraced, disbarred felon who can’t pursue the vocation that’s defined his life,” they wrote, adding: “It’s unlikely that any lawyer would look at what’s happened to Bansal and conclude that stealing from clients is still worth the risk.”
Update: A lawyer representing Bansal, Christopher Ingle, says Bansal was unaware of a federal law that bars contingency fees in pharmaceutical class action cases and he made an honest mistake. Bansal had self-reported his error, and he plans to reapply for his law license after passage of five years, as allowed in the state, Ingle says.
Ingle also says it’s not true that Bansal had been making millions of dollars a year. In reality, his annual income was in the six figures, according to Ingle.
Updated on July 20, 2017, to include information from Bansal’s lawyers.
