California Firm Named In WSJ Asbestos Fraud Investigation

A small Northern California law office this week will test that old saying that “any publicity is good publicity.” In a front-page Wall Street Journal story, an apparently bogus claim leads into an extensive investigation. After noting lax review of trust funds, the WSJ reported… “so when a beneficiary of one David E. Knight came to the trust saying the former seaman had succumbed to the deadly cancer mesothelioma, the administrators didn’t blink. Within five weeks, the claimant received a check for $26,250. The only problem: There was no such Mr. Knight. Police say the claim was phony, filed by an employee of a law office specializing in extracting payouts from asbestos bankruptcy trusts. California prosecutors are investigating.”
The paper used the case as an example of lax overview. The legal center involved says it was an employee acting on their own. The employee has left the firm and did not comment for the story. But the story illustrates the mess that is asbestos litigation. (Los Angeles County was recently named a “judicial hellhole” for asbestos cases by a national business group.)
Connect some dots by reading the full WSJ story here.