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Billing fraud and retainer mistakes are both legal malpractice

Maybe you are the executive at an organization that retained an attorney to represent the business in any disputes or contract negotiations that might occur. Perhaps you are an individual whose career path or personal standing necessitates having a lawyer on retainer.

There are many individuals and organizations that have working relationships with outside attorneys. Especially when lawyers perform frequent services for individuals and organizations and when there isn’t an in-depth review of every billing statement, there is some risk of billing fraud.

There are numerous laws and ethical standards for those who practice as attorneys related to how they bill their clients and manage their funds. Inappropriate billing practices and mishandling of retainers are among some of the more common financial issues that lead to legal malpractice claims.

Billing should be transparent and accurate

You have the right to a detailed invoice for any billable hours of service provided by your attorney. Unfortunately, there are those who will artificially inflate the time for which they bill. They may add a 15-minute increment to a client’s invoice for every email or phone message they receive, even if they only spend 30 seconds responding.

In scenarios where your billing statements either do not include enough information or seem to show a pattern of large charges for minimal services provided, the situation may involve ethical misconduct that could lead to a malpractice claim.

There are laws about retainers as well

When you decide to work with an attorney, they will typically ask you to pay a large retainer upfront, and they will bill against those funds before charging you for additional services in the future. Lawyers should carefully document when they receive retainers and for how much.

They should maintain those funds separately from business funds and should not use them for the firm’s needs. Commingling retainers with other funds or inappropriately using a retainer paid without rendering services are both forms of financial misconduct that could lead to claims against the lawyer involved.

The more egregious the billing issues or financial misconduct seems to be, the more important it is to assert your rights and hold the practice involved accountable. Recognizing when questionable billing practices cross the line and become legal malpractice can help you hold someone accountable for unethical or illegal behavior.