Risk Management

Lawyer Pleads in Milberg Probe

Prosecutors allege that he served as the middleman between the law firm and individuals who served as plaintiffs in securities class actions.
Stephen TaubMay 23, 2006

A West Coast lawyer has pleaded guilty to a felony tax charge for his role in the alleged kickback scheme involving law firm Milberg Weiss Bershad & Schulman, reported the Los Angeles Times.

Richard Purtich, who is based in Century City, just outside Los Angeles, was reportedly accused by prosecutors of serving as a middleman between Milberg Weiss and individuals who served as plaintiffs in securities class actions, enabling the firm to win lucrative “lead lawyer” status.

Purtich — the second person to plead guilty in the investigation, according to the Times — faces as much as three years in prison.

He reportedly admitted concealing from tax authorities nearly $900,000 in payments in 1993, made by Milberg Weiss to an individual who agreed to serve as a plaintiff in a number of lawsuits. Purtich also admitted that between 1992 and 1996, he received more than $3.5 million in Milberg Weiss checks described by the Times as for the benefit of law firm client Steven Cooperman. Prosecutors reportedly asserted that neither Purtich nor his associates made any referrals or performed any work to earn those payments.

Cooperman, a former ophthalmologist, was a plaintiff in roughly 60 Milberg class actions before he was convicted in 1999 for tax, insurance, and wire fraud relating to a staged art theft, according to the Times. He reportedly agreed to cooperate with prosecutors in exchange for a lighter sentence.

A spokeswoman for Milberg Weiss told the paper that the law firm “paid legitimate referral fees to Mr. Purtich and his law firm with no knowledge that Mr. Purtich and Dr. Cooperman had any secret agreement.”