Lawyer charged with defrauding asbestos clients
He lived high on $13.5-million in settlement money after telling clients he couldn't collect it, U.S. prosecutors say.
By ASSOCIATED PRESS
Published May 24, 2006
MIAMI - A disbarred lawyer pleaded not guilty Tuesday to federal charges that he defrauded thousands of clients out of $13.5-million in settlement money from lawsuits claiming they were sickened by exposure to asbestos.
Louis S. Robles, 58, faces 41 counts of mail fraud contained in a grand jury indictment unsealed Tuesday. Robles, who was disbarred in 2003 after an investigation by the Florida Bar into his financial practices, surrendered to U.S. authorities on Monday.
The indictment claims Robles took money from his asbestos clients' trust fund accounts and used it to pay for personal real estate, including a 9,000-square-foot waterfront mansion on Key Biscayne, apartments in New York and Los Angeles and a condominium in Telluride, Colo.
Robles also used the settlement money to invest in movie production and a waste management firm and to pay alimony to his ex-wife, the indictment said.
"Lawyers are defenders of the law; they are not above the law," said U.S. Attorney R. Alexander Acosta of Miami in a prepared statement. "Louis Robles abused the trust of his clients, stole their money, and spent it on himself and his various business ventures."
U.S. Magistrate Judge Stephen T. Brown set Robles' bail at $1.25-million. Because his property has now been sold and his bank and investment accounts frozen, a federal public defender, Hector Flores, was appointed to represent him.
The charges carry maximum prison sentences totaling well over 200 years, but Robles could receive between 15½ and 19½ years behind bars under federal sentencing guidelines.
Prosecutors say Robles had more than 7,000 clients in litigation against various asbestos companies, some of them bankrupted by an avalanche of personal injury lawsuits.
Many clients were workers who had been exposed for years when asbestos, which causes cancer and other health problems, was widely used.
From January 1989 until Sept. 30, 2002, Robles collected more than $164-million from 75,000 settlements on behalf of his clients, according to court records. At least 4,500 of his 7,000 asbestos clients were victims of theft, prosecutors said.
Robles allegedly concealed his theft of asbestos settlement money by telling clients their money hadn't been received because of the companies' struggles with bankruptcy.
An unidentified widow in Louisiana received just $420 from Robles when the lawyer had gotten more than $61,000 on her behalf. Another widow in Florida was entitled to $175,000 but got nothing, prosecutors said.
"Clients were calling, desperate for money," said Charles Duross, the chief prosecutor. "He wouldn't return their calls."
U.S. District Judge Alan S. Gold issued an order Monday freezing Robles' bank and investment accounts. At least partial restitution could be drawn from them if he is convicted.