Victims of shady lawyers reimbursed

ALBANY – An agency that reimburses victims of corrupt or egregiously negligent attorneys paid nearly $36,000 last year to the clients of former Capital Region lawyers – including one of the last victims of notorious debt reduction pitchman Andrew Capoccia.

Across New York, the Lawyers' Fund of Client Protection paid victims $10.6 million in 2017 — the second-highest figure in the 36-year history of the Albany-based fund, according to its recently released annual report.

The 215 local victims who received payments included former clients of disbarred Averill Park attorney Marcia J. Doyle Stallmer, disbarred Troy lawyer Alexander B. Perry, late Glens Falls attorney William V. Canale, and suspended Saratoga Springs lawyer John M. "Jake" Hogan III.

The fund paid $1,157 to the most recent of Capoccia's thousands of  victims. The 43-year-old victim — who asked to remain anonymous — told the Times Union it took two decades to get only a fraction of what she paid Capoccia. The process was frustrating, she said.

"Justice was not served," said the woman.

The victims fund is sustained through the collection of $60 payments taken out of lawyers' biennial $375 registration fees, said Timothy O'Sullivan, executive director of the fund.

The fund has paid out a total of $398,348 to the victims of Capoccia, a former Colonie-based debt reduction attorney who defrauded his clients and stole escrow money. The 414 payouts to his victims are the second-highest number in the history of the fund, O'Sullivan said. (Topping the list are the 458 payments to former clients of ex-Long Island attorney Andrew Robert Holman III, he said.)

"It was very unusual that it took as long as it did," O'Sullivan said of Capoccia's case. He said the circumstances of his disbarment case led to the lengthy wait.

Capoccia was disbarred in New York in 2000 for repeatedly engaging in frivolous litigation, and later relocated to Vermont. His legal troubles continued there: He was subsequently convicted in federal court in 2005 of conspiracy, interstate transmittal and transportation of stolen money, mail and wire fraud, receiving stolen money and money laundering.

Capoccia, now 75, is serving a sentence of more than 15 years in a federal prison in Lewisburg, Pa.

The fund paid $26,400 last year to a 39-year-old woman who was victimized by Stallmer, a former Rensselaer County Bar Association president and onetime assistant to state Attorney General Eric Schneiderman's Real Property Bureau.

Stallmer, 53, was charged in a loan scam. She conned friends and relatives while using the name of her family's well-established law firm in Rensselaer County. Stallmer would ask the victims for loans, at times promising good returns in exchange, then paid them back using other victims' money. In 2016, she pleaded guilty in Albany County to tax fraud and scheming to defraud. A judge sentenced her to 1 to 3 years in prison; she was parole a year later.

In total, the fund has reimbursed four of Stallmer's victims a total of $77,400, O'Sullivan said.

Perry, 52, a former prosecutor and public defender in Rensselaer County, was disbarred in 2011 for misleading and deceiving clients about the status of their cases. Last year, the fund reimbursed $3,000 to a 76-year-old man victimized by the attorney. O'Sullivan said Perry accepted $3,000 from the client, provided minimal services of no benefit, deceived the man and abandoned him.

A total of seven of Perry's ex-clients have now been reimbursed a total of $15,020.

The fund paid $4,873 to a man and woman in Rexford who were victimized by Glens Falls lawyer William V. Canale. The loss involved escrow funds misappropriated by Canale while he served as a court-appointed arbitrator, O'Sullivan said.

He said Canale, 80, was in good standing at the time of his death in 2013.

Not all of the sums paid to victims are so large: The fund paid out $300 to a victim of Jake Hogan, 57, who defrauded a client of an unearned legal fee, O'Sullivan said.

In 2016, the Appellate Division of state Supreme Court, Third Department, suspended Hogan after its grievance committee found he failed to communicate with a client, did not forward a client's requested file, misled the committee and neglected various legal matters and appeals of clients.

O'Sullivan said it involved a $300 advance legal fee for traffic court that Hogan accepted. He said Hogan provided minimal services, of no benefit, and abandoned the client.