Law Firm Escapes Criminal Charges in $75M Deal

Milberg will pay $75M, admit wrongdoing
By Matt Cantor,  Newser User
Posted Jun 17, 2008 7:41 AM CDT
Attorney Melvyn Weiss, co-founder of Milberg, right, and his attorney Benjamin Brafman, left, walk out of federal court in downtown Los Angeles, Friday, Oct. 12, 2007.    (AP Photo/Damian Dovarganes)
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(Newser) – Ducking criminal charges, law firm Milberg LLP will pay the government $75 million and admit wrongdoing in a settlement following a 2-year-old indictment, the Wall Street Journal reports. The firm, which deals with shareholders' class-action lawsuits, acknowledges it paid kickbacks to attract clients between 1979 and 2005, enabling the firm to reap $239 million in fees. The case names former partners, but no current ones.

“The settlement with Milberg reflects the seriousness of what was probably the longest-running scheme ever conducted by a law firm,” said a US attorney. Four ex-partners have pleaded guilty to paying kickbacks; one is in prison while another faces jail time. But “we can now say to courts and clients that we are not a firm under indictment,” said a Milberg rep.