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The phone rang the other day. Another one. Another victim of disgraced lawyer Kenneth “Shane” Service, the one-man wrecking crew whose meandering path of destruction is still being uncovered by the disabled, elderly and sometimes helpless clients he swindled. Allegedly.
Journalists are trained to say “allegedly” even when we know better. While Service has not been found guilty, there is nothing alleged about the missing half-million dollars or more from the special-needs trusts he established for many of his clients — money that vanished under administrator Service’s watch in what authorities say looks like a Ponzi scheme.
The money in those trusts was for the long-term care of people who had received settlements after they had been injured — some debilitated — in car crashes or accidents. Many of Service’s former clients’ money is gone. It must be cold comfort to them that Service sits in the Delaware County Jail, one of four counties where he faces trials on long-simmering felony theft charges. He also is accused, but has not been criminally charged, of stealing from estates he oversaw in four other Indiana counties.
One of the saddest parts of my job is when a victim calls, asking in exasperation, “Is there anything that can be done about this?” The very saddest part is the realization that, deep down, the caller already knows the answer is no, or next to no. No one is going to make them whole. And recommending the person in that situation hire a lawyer and file a lawsuit to seek blood from a turnip would be cruel. The profession has no contingency when one of its own who swore an oath goes rogue. Bad apple, you see.
It is a damned infuriating shame that in the years I have been at Indiana Lawyer, the bad apples have come by the bushel. Service. Durham. Conour. Blackwelder. Gupta. Fairchild. Marshall. Schuyler. Steele. Holesinger. Stochel. Hamilton. The list goes on. But each one of this dirty dozen was accused of stealing from the mid-five-figures to millions from clients — some the most vulnerable — just since 2012.
Indiana State Bar Association director Joe Skeel’s frustration with this is palpable. The ISBA does what good work meager resources allow through the Clients’ Financial Assistance Fund. But everyone knows it’s nowhere near enough. Its total financial resources would barely cover half the financial ruin Service alone is accused of visiting upon his former clients.
“It’s frustrating on every level, for everyone involved, except for the person committing the crime,” Skeel told me.
He said board members who oversee the fund sometimes express the frustration that it must feel like a slap in the face to someone granted $5,000 or $10,000 from the fund when their loss is multiple times more. I get that, but I also encourage those board members to see it another way: something is better than nothing to someone in need. What may seem a pittance might make a huge difference in another’s life. We do what we can with what we have. But we can do better.
I was encouraged when Skeel said the board also has been talking about looking for ways to supplement the client assistance fund with more than just the couple of bucks it receives from each ISBA member’s annual dues. Ironically, Skeel said, while the ISBA does what it can to help, the bad apples the fund aims to compensate for are almost never ISBA members. Frustrating indeed.
A couple of things need to happen.
First, the profession needs to admit it has a problem. A pernicious one. The heart of any profession’s credibility is how it addresses its known shortcomings. The answer here is money. The question is, where will it come from? Who will step up for this profession’s innocent victims?
Some may say beefing up victim restitution efforts would just enable the bad apples. Which is akin to seeing fire insurance as only encouraging arsonists. And we’ve established the profession has a small but persistent cohort determined to play with fire. Planning accordingly for the worst case is advisable. Undertaken in a meaningful way, a campaign of reform would have the side benefit of improving public perception of the legal profession.
Second, there must be a stern reckoning for people such as Service who prey upon the most vulnerable. (I know, allegedly.) The Legislature should enhance felony theft charges as an abuse of a position of trust when an attorney steals from a vulnerable client. Steal from a vulnerable client, you’ve earned a Level 5 felony, minimum, and almost certain jail time. Steal more than $50,000 from that client, you’ve earned a Level 4 felony.
Anyone want to do some justice, in the name of Service?•
• Dave Stafford — [email protected] — is editor of Indiana Lawyer. Opinions expressed are those of the author.
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