Disorder in the court: Cash-strapped lawyers running afoul of the law

Due in part to an imbalance in supply and demand, many attorneys in Japan are hurting financially. This pinch has led to a growing number of cases of their being prosecuted or subject to disciplinary measures for activities not permitted under the Lawyers Act or the Basic Rules of Professional Conduct.  

According to Spa (Aug 13-20), these cases often take the form of licensed attorneys delegating other individuals to engage in acts that only attorneys are authorized to do, such as financial restructuring, fraud damage recovery and others. 

In one widely reported incident, former Lower House Diet legislator Tomohiro Konno, age 48, was arrested last June along with 10 others over a suspected money-making scheme involving unqualified people performing legal services. 

In addition to Konno, Spa cited four other recent cases of legal malfeasance, three of which culminated in attorneys' arrests and the fourth of his being slapped with disciplinary measures. Three of these five involved so-called "romance fraud," which usually has to do with transfer of funds to an engagement partner who has no intention of going through with the marriage. 

In the past, explains Spa, it was a fairly common practice for attorneys to entrust other individuals with their office seal or business cards, but in recent years this has led to a growing number of fraud cases. 

A staff member at the Tokyo Bar Association pointed out that the larger the size of damages in a lawsuit, the greater the potential profits, which in many cases can run up to ¥1 or ¥2 million. 

In some situations, he said, skilled swindlers can rake in over ¥10 million in a single month. 

"And if the clients are unable to recover the amount they've been swindled, that may lead to secondary lawsuits, with even more losses," he said. "A lawyer might find it tempting, but the swindlers in these illegal tieup arrangements typically take 90% of the spoils."

Another contributing factor is that Japan has too many lawyers and not enough business to go around. 

"Around 2015, about half the attorneys in Japan were earning annual incomes of around ¥4 million," journalist Kenichiro Akiyama tells the magazine.  

Akiyama cites the case of a 76-year-old attorney, a certain Mr K, who upon graduation from law school spent years as a salaried employee at a big legal office. Afterwards he hung out his own shingle and currently takes home ¥3.5 million a year, which he considers enough.

Mr K was approached by a shadowy figure who proposed a tieup that would bring him more business. 

"It was all about money, and he suggested profits would materialize in the future," Akiyama relates. "K turned him down because the story sounded too suspicious. I wondered if there were any lawyers who would go along with a proposal like that." 

"It's true that these swindlers have been setting their sights on low-income lawyers," said Akiyama. "Right now we are can categorize lawyers into three types: those who are earning enough; those who can't make a living but still do their duties properly; and then there are those who have fallen prey to non-lawyers.  

"The lawyers most likely to be targeted are those who are registered on paper as attorneys but who are not actively engaged in the legal profession," Akiyama continues. "Many of those who've been arrested or subject to penalties are older, retired or semi-retired individuals." 

"Right now there are about 45,000 lawyers in Japan," Yuji Miyazaki, an Osaka-based attorney, told the magazine. "Following reforms of the controls on the legal profession that have been implemented since the year 2000, their numbers began surging, are now around four times the figure of the 1980s. 

"Also, people who in the old days would have had difficulty passing the bar examination are able pass now. And if the total number of lawyers increases, the number of lawbreakers naturally increase as well." 

What's more, attorneys are competing for smaller slices of an ever-shrinking pie. In 2000, they handled more than 3 million cases. At present that figure has dropped to around 1.3 million cases per year. 

"It's hard for them to resist temptation in cases where they are entrusted by clients with large sums of money, when they can barely cover their office costs," Miyazaki remarked. 

Miyazaki also raised the problem of lawyers' mental health as a contributing factor in the troubles.

"People in our profession can't easily avoid stress, especially when they have to deal with unmanageable 'monster clients,'" he explained. "So we're seeing more cases of lawyers who can't cope with the stress and sit on pending cases, leaving them unresolved." 

According to Miyazaki, the Japan Bar Association has set up a consultation service for disaffected clients to complain, and can also assist in providing counseling and support.

© Japan Today