Southeast Texas Record

Monday, March 30, 2020

It's open season on swindlers

Our View

By The SE Texas Record | Jan 25, 2016

Speaking of a three-pronged approach to combatting swindling . . .

Last week, we were doing just that, pointing out that “prosecuting swindlers is the third prong of an obvious three-prong solution, the first being a willingness on the part of defendants to fight back against fraud, and the second being a determination among judges to reject unreasonable claims.

“Once it becomes clear that defendants won't roll over, and that judges hearing their cases won't tolerate fast-and-loose tactics, the number of would-be swindlers is likely to drop,” we predicted.

We cited two recent cases – both involving 2012 hail damage and both handled by Steve Mostyn's law firm – in which State Farm fought back against inflated claims and won.

State Farm isn't the only one fighting back.

Late last month, Allstate Texas Lloyds filed suit in Tarrant County against Edinburg attorney R. Kent Livesay, accusing him of fraudulently representing storm victims.

Dallas commercial insurance attorney Steven Badger speculates that the victims in question may have been tricked into securing representation.

“Homeowners believe they are signing agreements with either a roofing contractor or public adjuster, but unbeknownst to them they are also signing attorney representation agreements,” he said.

“A lawsuit is then filed in the homeowner’s name without the homeowner ever meeting or even talking to the lawyer. They have no idea they are a party to a lawsuit.”

Badger said Allstate “should be commended for taking this action, not for its own benefit, but for the benefit of its insureds who are unwittingly parties to lawsuits they want no part of. They are the real victims here.

“All of these lawsuits are driving up insurance rates, increasing deductibles, and reducing available coverage for all Texans. A few lawyers are getting rich and all Texans are suffering.”

Badger recommends resorting to the third prong, as well, to send a message: prosecuting swindlers so that “others engaged in the same conduct will fear (the loss of) their law licenses and stop.”

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