Two out-of-state companies and one former attorney were sanctioned by the Ohio Supreme Court today for the unauthorized practice of law.

The Supreme Court unanimously issued injunctions blocking the performance of legal services in Ohio to:

• Lorraine T. Furtado of Columbus
• Century Negotiations Inc. of North Huntington, Pennsylvania
• Home Advocate Trustees, purportedly of Redmond, Washington, and San Diego, California

The Court’s per curiam opinions stated that Furtado and Home Advocate Trustees (HAT) were ordered to pay a $10,000 civil penalty.

Furtado is a former Ohio attorney, who was admitted to practice in 1986, but suspended by the Court for two years in 1994 after she was convicted by the federal government for embezzling government funds. In May 2000, the Court accepted her resignation with disciplinary action pending for a separate matter.

The opinion stated that her resignation was “unconditional, final, and irrevocable.”

In May 2012, Furtado drafted estate-planning documents for Corlyss Richards, and counseled Richards on several issues regarding a trust of Richards’ father. Richards paid Furtado $8,670 for her services through August 2013, and has demanded that the money be returned. Furtado has not returned it.

Furtado did not respond to copies of the complaint and did not participate in board’s disciplinary proceedings. The opinion stated an attorney who resigns with disciplinary action pending is no longer authorized to practice in the state, and that because Furtado gave “legal advice and prepares wills, trusts, and powers of attorney” she engaged in the unauthorized practice of law.

The Court concluded that since Furtado led Richards to believe she was licensed to practice despite having resigned, a $10,000 civil penalty was warranted.

2017-0542. Disciplinary Counsel v. Furtado, Slip Opinion No. 2017-Ohio-9109.

The opinion noted that a corporation cannot lawfully practice law in Ohio, and cannot do it indirectly by employing qualifying lawyers. Lawyers are prohibited from working in the form of a professional corporation or for a for-profit business if a nonlawyer owner or officer has the right to direct or control the lawyer’s professional judgment.

The Court concluded the practice of law includes “making representations to creditors of third parties, advising persons of their rights, and the terms and conditions of their settlement.” The opinion stated that would include negotiating the collection claims on behalf of debtors. Century Negotiations bargained with the creditors of its Ohio customers to settle their delinquent debts, and the Court found that was the unauthorized practice of law.

The parties stipulated to the charges against the company and Century agreed not to engage in further unauthorized practices in Ohio, and to provide written notice to its Ohio customers of the agreement. The board found no evidence that the company’s customers were harmed by the conduct and did not recommend a fine.

The Court agreed not to fine Century, but required the company’s chief executive officer to submit a sworn affidavit within 180 days of the ruling ensuring it notified all Ohio customers, and take steps to locate customers that he was unable to locate through its customer list.

2017-0543. Ohio State Bar Assn. v. Century Negotiations Inc., Slip Opinion No. 2017-Ohio-9110.

Melanie Biscardi of Land O’Lakes, Florida, was deposed by the bar association and stated she accepted a position at HAT as an independent contractor. She acted under the supervision of a man who identified himself as Mark Farley, who said he was an attorney based in San Diego. Federal authorities later identified the man as Mark S. Farhood, who is not an attorney.

HAT marketed itself as an entity that could assist financially stressed homeowners, who could transfer their property to HAT, and the company would work to obtain a new mortgage for the property. The property owners then could pay HAT to get back ownership of their homes.

HAT employees prepared and filed documents on behalf of homeowners, including two Ohioans, on templates provided by Farhood to which they affixed Biscardi’s electronic signature. In one instance, a lawyer representing a bank that was foreclosing on one of HAT’s Ohio customers noticed the appearance and discovery request filed in Biscardi’s name—although she was not an attorney. The lawyer suggested that the preparation and filing of such documents constituted the unauthorized practice of law.

Biscardi said she learned in late 2012 that Farhood and HAT were being federally investigated for fraud, and that HAT had taken no actions to establish new mortgages or obtain loan modifications. Farhood was sentenced to 11 years in prison with three years of supervised release.

HAT did not respond to the unauthorized practice claims, and the board agreed to dismiss charges against Biscardi and the other employee.

In addition to an injunction preventing HAT from performing legal services in Ohio, the Court also imposed a $10,000 civil penalty.

2017-0541. Ohio State Bar Assn. v. Home Advocates Trustees LLC, Slip Opinion No. 2017-Ohio-9108.

Please note: Opinion summaries are prepared by the Office of Public Information for the general public and news media. Opinion summaries are not prepared for every opinion, but only for noteworthy cases. Opinion summaries are not to be considered as official headnotes or syllabi of court opinions. The full text of this and other court opinions are available online.