Former product liability lawyer sentenced to prison for fraudPosted On: Feb. 27, 2020 5:32 PM CST
A former law firm partner who specialized in product liability subrogation claims, who was charged with defrauding almost $3.5 million from insurers, manufacturers and others, received a five-year prison sentence in federal district court Thursday in Philadelphia.
In his subrogation practice, Craig A. Cohen, formerly counsel for law firm White & Williams LLP in Philadelphia, sought recoveries on behalf of insurance companies through settlements or litigation for losses caused by defective products, according to court papers in United States of America v. Craig A. Cohen.
In each case, insurers first paid the insured individual or entity for losses caused by water damage, then after payment Mr. Cohen and other attorneys with whom he worked attempted on behalf of the insurer to recover funds from the defective product manufacturer that was responsible for the losses. In some instances, recoveries were pursued from settlement funds generated by class action lawsuits against manufacturers.
Court papers said Mr. Cohen caused actual losses of almost $3.5 million by submitting 83 “completely fake and fraudulent” claims, with victims including product manufacturers, class action settlement funds, insurers and his law firm. He also submitted another 21 additional fraudulent claims totaling $1.19 million that were not paid.
Mr. Cohen, who is now 55, created and registered with Pennsylvania a legal entity, WLSP PLLC, listing his law firm’s Philadelphia address as the place of business, and opened a bank account for WLSP using his home address for its bank account.
The applicable guideline in Mr. Cohen’s case ranges from 63 to 78 months in prison or between five-and-a-quarter years and six-and-a-half years, according to a court filing.
A sentencing memorandum filed by his attorney Wednesday, which sought a sentence more lenient than the guideline, pointed to substance and gambling addictions as the factors behind his criminal activity.
The filing said Mr. Cohen “now stands humbly” before the court “in disgrace, humiliated by his reprehensively fraudulent conduct, the trust he has breached and the pain he has caused.”
“But it is impossible to comprehend how or why Mr. Cohen descended into the darkness that enabled the loss of his previously unblemished moral compass,” said the filing.
A responding memo by the U.S. Attorney’s Office in Philadelphia said, “Mr. Cohen’s current guideline range already reflects a substantial discount from the prison time he could have faced in this case if he had not accepted responsibility as he did.”
Mr. Cohen’s attorney, Philadelphia-based Hope C. Lefeber, said, “The judge held a very fair hearing and took everything under consideration, and allowed us to present a case and we believe we were treated fairly.”
She said Mr. Cohen will self-surrender to begin his sentence in 60 days.
A spokesman for the U.S. Attorney’s Office could not be reached for comment.