News Releases

Los Angeles attorney facing disbarment for collecting $258,400 in illegal advanced fees for loan modification services

Contact: Laura Ernde

415-538-2283

barcomm@calbar.ca.gov

SAN FRANCISCO, Feb. 22, 2016 — The State Bar Court Review Department has recommended disbarment for Los Angeles attorney Gene Wook Choe for misconduct that included collecting $258,400 in illegal advanced fees for loan modification services.

Choe, 53, [member #187704], also made unauthorized withdrawals from client accounts and committed acts of moral turpitude in his bankruptcy practice, the court found. His disbarment must be approved by the California Supreme Court before it goes into effect, however he has been ineligible to practice law since May 2013 as a result of the disciplinary case brought by the Office of Chief Trial Counsel.

Choe argued that he changed his business model after the Legislature passed a law in 2009 prohibiting attorneys from accepting advanced fees for loan modification services. He charged clients for “litigation services” while providing loan modification services for free. The court found that Choe “did not change his practice.” Instead, “he simply revised his fee agreements” in “an obvious, but unsuccessful effort to avoid” the legislation. The court called Choe’s misconduct egregious and widespread.

“He repeatedly violated state and federal statutes and caused significant harm to vulnerable individuals fighting to save their property as well as significant harm to the bankruptcy courts,” State Bar Court Judge Catherine D. Purcell wrote for the three-judge panel.

The full text of the court opinion is available on Choe’s attorney profile page of the State Bar website.

From 2009 through January 2016, the Office of Chief Trial Counsel has pursued disciplinary charges related to loan modification services in approximately 1,957 cases involving roughly 251 licensed California attorneys. Of those cases, approximately 1,678 cases have resulted in discipline (involving 222 attorneys) and 1,048 of those cases have resulted in disbarment (involving 99 attorneys). Approximately 228 cases (involving 29 attorneys) are still pending before the State Bar Court, with another 91 matters (involving 50 attorneys) under active investigation by the Office of Chief Trial Counsel.

Consumers who have been defrauded by a California attorney may file a complaint with the Office of Chief Trial Counsel or call 800-843-9053. The State Bar also maintains the Client Security Fund to reimburse eligible victims.