In this episode of the Wealthy Woman Lawyer® podcast, I sit down with Mark Bassingthwaighte, a seasoned attorney and national risk manager with ALPS—the nation’s largest direct writer of lawyers’ malpractice insurance. With decades of experience helping more than 1,200 law firms manage risk, Mark has seen it all—and he’s sharing what you need to know now to protect your firm and your future.
Listen in as Mark and I explore:
- The common claim that still ranks #1 in frequency year after year—and how to avoid it.
- Why your biggest malpractice risk may have nothing to do with your legal skills.
- What solo and small firm owners *don’t know* about cybercrime (and why it could cost them everything).
- The truth about accidental clients and why a casual conversation could put your law license at risk.
- What attorneys often get wrong about conflicts of interest and trust accounting—and how to do better.
- The essential policies, coverage, and documentation practices every modern law firm needs now.
- Why prioritizing wellness is more than self-care—it’s malpractice prevention.
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To learn more about Mark and his work at ALPS, visit www.alpsinsurance.com.
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Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Intro (00:01):
Welcome to the wealthy woman lawyer podcast. What
Davina (00:05):
if
Intro (00:05):
you could hang out with successful women lawyers, ask
them about growing their firms,managing resources like time,
team, and systems, masteringmoney issues, and more? Then
take an insight or two to helpyou build a wealth generating
law firm. Each week, your host,Devina Frederick, takes an
in-depth look at how to thinklike a CEO, attract clients who
(00:25):
you love to serve and will payyou on time, and create a
profitable, sustainable firm youlove. Devina is founder and CEO
of Wealthy Woman Lawyer, and hergoal is to give you the
information you need to scaleyour law firm business from 6 to
7 figures in gross annualrevenue so you can fully fund
and still have time to enjoy thelifestyle of your dreams. Now
(00:48):
here's Devina.
Davina (00:50):
Hello, and welcome to the Wealthy Woman Lawyer
Podcast. I'm your host, DevinaFrederick, and my guest today is
Marc Bassingthwaite. Marc is anattorney who has worked as a
risk manager with Alps since1998. Alps is the nation's
largest direct writer oflawyers' malpractice insurance.
In his tenure with the company,Mark has conducted more than
1,200 law firm risk managementassessment visits, presented
(01:13):
over six fifty continuing legaleducation seminars throughout
The United States, and writtenextensively on risk management,
ethics, and technology.
He is a member of the State Barof Montana, as well as the
American Bar Association, wherehe currently sits on the ABA
Center for ProfessionalResponsibilities Conference
Planning Committee. He receivedhis JD from Drake University Law
(01:36):
School. Please join me inwelcoming Marc Bassenthwaite to
the Wealthy Woman Lawyerpodcast. Hi, Marc. Welcome.
It's good to see you today.
Mark (01:44):
Well, thanks for having me. It really is a pleasure to
be here.
Davina (01:47):
Good. How's the weather in Montana?
Mark (01:49):
Well, we just got back from Montana and it's a typical
Montana spring. I actually liveand work remotely. So I'm down
right outside of Orlando,Florida. Nice, so you're in my
old stomping grounds. Oh okay,
Davina (02:06):
yes. My listeners know that I lived in Orlando for like
forty years. I'm a nativeFloridian, and then I just moved
last year to Colorado, twentytwenty four or 2023 rather. So
anyway, all right, so we're allover the place. Look at us being
in this modern world.
So tell me a little bit aboutthe company you work for and
(02:30):
what it is that you do.
Mark (02:32):
Okay. The company is Alps, Alps Insurance. We've gone
through various names over theyears. We go back to the days of
Nabrico. In the early to late80s, or I should say mid to late
80s, legal malpractice insurancewas almost impossible to buy.
It was an extremely hard market,and several companies were
(02:55):
formed under some federalregulations called Nabrico,
National Association of BarRelated Insurance Carriers. And
from there, we've grown to benow a nationwide carrier. We've
left Nabrico years ago, but wedo all things for lawyers. It
started out being allmalpractice and only
(03:17):
malpractice. Now we do cyberliability, employment practices
liability, bonds, all types ofbusiness insurance.
So that's, you know, but it'sall just lawyers, that's all we
do. My job, and I've been in,I've had various titles, but
it's all been basically the samething, just as it evolves over
(03:39):
the years. I'm a risk managerright now, like sort of refer me
as the national risk manager.And what I do, I sort of
describe myself at times, I'm alawyer's lawyer, but I'm on the
proactive side. I do a lot oflecturing, a lot of writing.
(04:00):
Over the years earlier on, Iused to do a lot of consulting,
have consulted with over 1,200law firms of all shapes and
sizes from many, many solos upto about 120 lawyers. And my
visits would take anywhere fromhalf a day to a week depending
on the circumstances and thesize of the firm. But it's a lot
of education. Let's talk aboutwhat are your processes and
(04:22):
procedures? What are you doingin terms of security, in terms
of cybersecurity?
Doing a lot of wellnesseducation. So it's been a great
ride. I never in a million yearsthought I'd be in a chair like
this, but here I Yeah, I'mcurious.
Davina (04:39):
I'm curious because you are a lawyer. What led you to go
into the insurance side of it?
Mark (04:47):
Well, it's one of these crazy sort of happenstance
things. I truly never even knewthat jobs like this existed.
After law school, I was reallyset to go, well, should say
doing law school, was reallyheading toward litigation. But I
also had an interest ininsurance law and tax. And then
(05:09):
after law school, during lawschool was a little bit of a
move from Iowa to Montana, buthung up a shingle and was
starting down that path with apartner, a law school partner.
And somebody was building ahouse right behind us. We were
all in a new development, andthis gentleman was the first
(05:30):
risk manager at Alps. He was anon lawyer, but truly an
insurance guru. And we got totalking. He's telling me about,
you know, risk management andwhat this is all about.
And I looked at him and I said,you know, Bob, would you ever
consider having an attorney joinyou to do this? And he kind of
(05:51):
just jaw dropped. He said, Wait,lawyers would do this? I said,
Bob, if you advertise forlawyers, you're going to get a
line of people. And about, Iwould say almost a year later, I
got a call for advertising.
You've got to go through theprocess and there are other
lawyers in the queue, but I wasblessed that it worked out and
(06:13):
I've never looked back.
Davina (06:15):
Yeah, I think you have to have it's probably very
unique to have such an interestin risk management and insurance
and all of those kind of things,but it's probably been a really
rewarding career as well becauseyou probably learned things that
you never even thought about.
Mark (06:32):
You are so right. I kid around at times, but there's an
element of truth to this. One ofthe things I'm seriously
considering when I retire, andI've still got anywhere from, I
don't know, five to eight yearsleft. We'll see how it goes. But
I want to write a book, How Notto Practice Law, and just call
it Observations of a RiskManager, know, something like
(06:53):
that.
Davina (06:53):
Yeah, think that would be Tell
Mark (06:55):
some of these stories. Oh my Yeah.
Davina (06:58):
Well, I'm going get you to share some of those stories
today because I was approachedto have you on the show and I
thought, that is brilliant. Idon't know why I haven't had
anybody who talks aboutinsurance and risk management
liability for law firms andlawyers before, because this is
such a huge part of our businessthat a lot of us don't think
(07:20):
about until suddenly we get intotrouble. So I'm going to ask you
a lot of questions along theline. Hold on just one second so
we can cut this part out. Not ifyou're my dog.
So some of the questions I wantto ask you, I want to start out
talking about some of the mostcommon claims that you see every
(07:48):
year in the business and havethose changed over time?
Mark (07:52):
You would think that they would, and the answer is no.
I've been at this for twentyseven years and it's the same
old, same old on the malpracticeside. Now how some of these
arise can differ a little bit.Boy, one of the big ones, I
mean, in terms of the frequencypiece, you look at the national
(08:14):
data, it's going to be acalendaring misstep. They
continue to happen over and overand over again.
And you know, once you blow astatute, which is the ones that
really start to worry us becausethere can be a lot of exposure
on those, it's really, everyonce in a while you can do a
little claims repair, but mostof the time it's just how much.
(08:36):
They get very Can
Davina (08:39):
you give me an example of that?
Mark (08:41):
Well, let me tell you how one came up. It's an interesting
story, and there are a practicerisk tip or two here for your
listeners. So I'm going to dothis in the context of, and
again, this is a true story, butI'm going to pretend it's us. So
you'll be the lawyer and I'mgoing to be your paralegal, and
(09:02):
we do personal injury plaintiffwork. What we do is we have four
calendars and we think, youknow, we've got these multiple
systems and they're going todouble check, etc.
So, you have calendar on yourcomputer. Let's say you're using
(09:24):
CLIO or something and it syncsto the cloud. I have a day
timers desktop thing that's sortof my master calendar. And maybe
we have a digital or a papertickler system, okay? Now here's
our process.
I do everything. I open themail, I hit calendar from either
(09:48):
court or everything, and I'mputting everything in my book.
And then I copy that. I take itto the file room. I sit down at
your desk or I enter into your,you know, and put it in Clio.
So we think we have fourcalendars, we only have one. And
there's just these copies. Nowthe problem is, what if I make a
mistake? Okay. Now lawyers attimes will say, okay, I know I
(10:14):
should do some double checking.
So I'm going to watch Mark anddouble check. And we'll put this
second set of eyes. I want tocreate an independent countering
system. And so you say, I'mgoing to start watching what
Mark does. And over the nextyear, eighteen months, you're
double checking.
You're looking at my calendarentries or you're maintaining
(10:35):
your calendar separately. Youknow, you do the Clio and it
backs up, I do my book, and itcopies it to the file system or
the detector system. We bringthese together once a month or
whatever and do calendar review,and you never find any mistakes.
So you stop. And so now there'sno quality control again.
(10:58):
What happened in this situation,shortly after you stop, that's
three to six months something, Igot a call from my brother.
Mom's just had a stroke. It isnot good. You need to get out
here quickly. Oh my gosh, lifeis happening on overdrive.
It's just, I'm doing as much asI can as quickly as I can to
(11:21):
minimize the impact of thisunexpected departure. I'm trying
to get airplane tickets. Who'sgoing take care of the dog? What
about the kids? Life is on highI make a mistake then.
It just happens. People makemistakes from time to time. So
the lesson here is, you know, weneed to have independent, and
(11:44):
see, then that mistake was notcaught until after the statute
ran, because it wasmiscallendered. We need to have
independent systems, you know,so you do your piece, I do my
piece, or I do it all and youlook at original documents and
double check my entries, etc, tomake sure it's correct. It's not
(12:06):
about competency.
This is about a quality controlprocess to ensure the competent
on time delivery of all theservices that we are getting
involved in and delivering. Soindependent calendaring is an
extremely important useful tool,and there are a hundred ways to
(12:26):
do it, but you need to have trueindependence, and that can
prevent these kinds of mistakes.So that's sort of the frequency
piece. If you're interested
Davina (12:36):
And just to go into that, so what happened is the
ball got dropped for the client,statute of limitations ran, and
then we're out of luck, and theclient's out of luck, and you've
really screwed up, even thoughyou didn't mean to, and it was
all an innocent mistake. Soprocesses and systems are key
with your calendaring and havingsomething that's independent,
(12:58):
that's not dependent on sort ofthis one person without some
checks and balances. All right,good, good. Thanks for sharing
that. So what other kinds ofthings?
I know one thing that I think ofwhen I think of liability is
always because we hear thisdrilled into us from the Bar
Association and that is alwaysabout things like trust
accounts. Is that somethingthat's a big claims issue or
(13:23):
what other kinds of things?
Mark (13:24):
Well, that raises a really interesting dilemma that a lot
of lawyers aren't thinkingabout. So I'm going to come at
this in two ways. Are trustaccount missteps a significant
problem in our profession? Andthe answer to that would be yes,
primarily on the disciplineside. We're just too lax.
(13:49):
Sometimes there's, you know, abounced check or something in a
number of states. Banks arerequired to automatically report
that to the bar, and thenthere's a little investigations
and things. Sometimes there'sjust random audits. And as a
profession, we do not have trustaccounting down. There are some
firms that do a really, reallygood job, but, you you can't
(14:11):
just close your eyes to this andsay, don't need to worry about
it.
I'm just gonna have a bookkeeperor a CPA and let them do it. I
mean, there are rules in play,and you must follow them and
it's your license on the line ifthere's a problem. So that's
sort of the first half. Wheretrust accounts and actually goes
a little broader. We could talkabout the firm's operating
(14:33):
account as well, but trustaccount, there's a lot of time
where we are moving moneythrough the trust account,
right?
Whether it's, know, again, asettlement check, lots of times
money's moving through here. Thereal risk on trust account is
cybercrime. And here's what alot of lawyers don't know. I go
(14:55):
out and I buy a malpracticepolicy and it's going to cover
me for everything that I do as alawyer. That is simply not true.
There are lots of exclusions andlots of situations where it
isn't going to cover you. Thisis one. The vast majority of
malpractice policies providelittle to no, sometimes there
might be a sublimit in play, butlittle to no coverage for these
(15:18):
types of financial losses. So ifyou're scammed, business email
compromise scam, a wire fraudscam, and folks please hear me
very clearly. This is notlimited to real estate lawyers.
If you are moving money, I'veseen every type of lawyer that
moving money get hit. It's now,yes, real estate lawyers are
(15:39):
getting hit more often, but I'veseen this in multiple practice
settings. So the way to thinkabout this is if you are scammed
and you've wired some money orsomething, that is a property
loss. It is not negligence. Sothat's sort of the simple, easy
way just to think about it.
Can you insure for that?Absolutely you can, but it's not
(16:04):
malpractice policy. And I haveseen lawyers take hits in the
half million, million, millionplus. Wow. You know, where they,
some of these situations Becauseit's
Davina (16:17):
not covered by their malpractice insurance, their
general malpractice insurance.
Mark (16:21):
But they're liable for the loss.
Davina (16:23):
Let's talk some about the cybercrime because I had a I
was talking to a client aboutit, I was concerned about, so a
lot of law firms are workingremote and they're hiring people
and the people are working outof their houses. I was talking
about issuing equipment insteadof having them use their own
equipment as employees, and kindof the dangers of them using
(16:46):
their own equipment. It's maybea family computer that junior
gets on and starts playinggames, there's a problem. You
know, they open it up to,potential, cybercrime hacking or
whatever, or just somebody'sseeing something. And then also,
at kind of her response, I mean,which we were talking about,
(17:08):
well, know, I'm uploading, it'sall coming up to the cloud, The
the case management software isall on the internet.
It's all uploading to the cloud.The equipment is just like, you
know, kind of like we used tohave the dummy equipment, and it
all went to servers. Right? Youknow, this sort of idea and and
(17:30):
this belief that I'm small fry.Hackers are not gonna be coming
for me.
These ransomware hackers thatyou hear about, they're not
gonna be coming for me. And soreally not a lot of concern. And
and she's very her statementswere very common, what I've
heard other people say. So whatwould you say to that?
Mark (17:51):
She's wrong on every one of these points. First off, size
has nothing to do with it. Manyof these ransomware attacks are
sort of software as a servicetype companies, and they are
hitting anybody and everybody.If they hit and because these
(18:12):
they're directing it just towhoever falls prey, okay? So if
you hit a solo small firm asopposed to, you know, one of the
global firms or something, theransom amount that they're going
to demand is going to bedifferent because they
understand, you know, this is asolo lawyer, but they'll take
(18:34):
whatever they can get in anysituation.
So ransomware is not directeduniquely at large, it's directed
at the masses. It's allautomated, AI is now getting
involved, and it is not goodfolks. The belief that we're too
small to be on anybody's radaris also woefully mistaken. I've
(19:00):
shared with ransomware as anexample, these are automated
attacks, so it doesn't matter.But when it comes to other types
of attacks, small businesses andparticularly solo small firm
lawyers are highly preferredtargets for a number of reasons.
Two are that we have a lot ofthe same information, valuable
(19:20):
information, you know,personally identifiable
information. There are differenttypes of secrets and confidences
that can be monetized. And two,we don't have the tech savvy and
the financial wherewithal toproperly secure our systems in
the same way that a largecorporation could as an example.
(19:40):
So high profile targets, this isthe low hanging fruit. You know,
we sell cyber insurance, and I'mtelling you we see a lot of
claims, and our market is allsolo and small firms.
You know, we're The large firmsinsure themselves sort of in
slightly different channels indifferent ways. We see a lot of
Davina (20:05):
claims. Are we seeing people hacking in and taking
client information that kind ofthing is that what we're seeing
a lot of or is it?
Mark (20:13):
Yeah, yeah, ransomware and wire fraud are very very common,
but we do see and here'ssomething else I want you folks
to understand. We talk about inthe security space,
(20:35):
professionals don't hackcomputers, they log in, okay,
because the scams are sosophisticated, these phishing
scams, and they'll get in and,you know, they can do all kinds
of things. And we'll think forinstance, ransomware. We still
(20:57):
believe that ransomware is allabout encrypting the data and we
have to pay ransom to get itback. They're holding our data
ransom.
And now that's still verycommon, but that's not the end
game anymore. What they're doingis they're holding, they go in
and take all your data out, havecopies of it in other words, and
(21:21):
then they encrypt, and then theycome back and say, well, we want
money to decrypt. You pay themoney and you may or may not get
your data back, but let's sayyou do. Then a little bit later,
you're going to get anotherransom. Oh, we have all your
data and we're going to sell iton the deep web or the dark web,
whatever you want to call Unlessyou pay us another ransom and
(21:42):
you pay that and then they stilldon't delete.
I mean, these are bad people,you know, so there's lots and
lots of stuff going on there.
Davina (21:50):
Never ending. My husband, for about twenty five
years, worked doing IT tech forinsurance defense firms all
throughout the Southeast and hehad some all over the country.
One of the things he said was avulnerability, was a big
vulnerability people didn'trealize would be the, at the
(22:13):
time, secretaries, assistants,paralegals, who wanted to have
the butterfly screensaver or theJesus screensaver on her
computer and didn't realize thatthat created a vulnerability for
people to access the computersthat weren't at the law firm.
(22:33):
And so many things like that, Ithink that a lot of people don't
think of is that your employeesare often pass into your system
because they fall, like you say,they fall prey to these sort of
phishing scams. They're clickingon links in emails, and there's
a lot of that sort of in policythat we need to be addressing
(22:56):
saying this is what we do, iswhat we don't do.
Go
Mark (22:59):
ahead. So let me circle back to an earlier comment you
talked about, know, there's alsothis belief that, you know, it's
phone computers and whereeverything's in the cloud and
there's a Folks, what you needto hear clearly and I, you know,
I my cell phone. This is mypersonal phone, but it's also
used for work. I've been workingremotely for over fifteen years
(23:21):
now and all of this equip,almost all of it, is all mine.
Now I have a lot of things thatI need to do to keep this very
secure because we're a regulatedcompany, but that's also, I'm
just a little paranoid and so Ido a lot of things that other
people don't But this is theweak stuff folks, this is what
(23:43):
you need to hear.
You know, the modern day threatback in the day and I get it,
know, the butterfly screensaverswere risky certain Now it's the
personal smartphone that's usedfor work. It's the same thing.
And any individual at your firm,even if it's just two people, so
you and a secretary, You know,the person that is not fully
(24:09):
secure both on socialengineering awareness training,
understanding what the currentphishing attacks look like,
understanding what attacks looklike on the smartphones. And
hear me clearly folks,smartphones are a high profile
target. More and more attacksare going to the mobile space
than just about anything elsebecause this is, we all treat
(24:32):
this stuff in a different way.
We don't think a text messagewould, you know, can be used to
fish us out of some information,and absolutely it can. Identity
theft is very easy to occur.Bank account access, very easy
to occur,
Davina (24:48):
using these media apps you're signing up for, you're
giving permission to accesseverything on your phone, from
your microphone to your bankaccounts that you have attached
to an app phone. Highlyvulnerable places. If your
paralegal has an app on herphone to access a case
(25:13):
management system and she alsohas TikTok or some other social
media. It could be meta for allI know, right? Meta certainly
gets access to everything, It'sjust not the Chinese government.
But that there's a vulnerabilityin that. Who's accessing this?
(25:33):
Who's who's able to get thisinformation? It could be some
employee that works for one ofthese companies that so they or
games are a huge thing. How manypeople let their kids use their
phones to play games?
And if they're doing businessand personal on that phone,
that's a problem.
Mark (25:50):
It is. It's a huge problem. Here's what people
don't think about. You know, inmy mind, nothing in life is
free. I used to, when our kidswere still young, I'd say, I'd
try to teach them, you get whatyou pay for.
Well, whether it's gaming apps,all kinds of apps that we put on
our devices, our mobile devices,and you think, well, why is it
(26:14):
free? I assure you it's verycostly to develop these apps and
these games. There's a lot ofmoney here, but they're giving
it away. Well, why? Because whenyou get it for free, the one
thing they ask is we have accessto everything going on on your
phone and we are going tomonetize that.
(26:38):
And the information that theyare pulling off these phones and
laptops and tablets and all the,you know, is extremely valuable.
They are making gobs of money atthis. You know, again, think
about Facebook, how much moneythey make. Did you pay for that
(26:59):
app? No, no, no.
Right? Just saying. And
Davina (27:02):
so as law firm owners, what I think we're talking
about, I mean, there's obviouslyyour personal vulnerability, as
law firm owners, you have anobligation to your clients to
keep their informationconfidential. And so if Betty
Sue, who works in your office,has an app on her phone, and the
(27:26):
company who makes the app maysay that's a very secure app,
but you wonder if she's got thatand also some games on it and
some social media on it. Are youexposing your clients to being
hacked? And we see it all thetime with large companies. I
mean, why do we think we're anexception to that rule?
(27:48):
And lawyers, I think areparticularly targeted, even
though we don't realize it,because we, small firms are
going to be a little moreuneducated about those types of
things. We're busy trying tojust run a business. We're not
thinking about this. And then wehold such powerful confidential
information all the way fromsocial security numbers to birth
(28:12):
dates and all the ages of theirkids. Mean, like everything
right out there.
So, all right. So, is thereanother area that you really
want to tell us about that issomething that we really need to
be paying attention to in termsof the most claims that you're
seeing?
Mark (28:31):
Well, I would say what we could talk about, conflicts of
interest. You know, I shared atthe beginning calendaring is the
severity piece, or I'm sorry,the frequency piece. Conflicts
of interest claims are theseverity piece. And these things
just always boil down to greedyattorney putting his or her
(28:52):
financial interests about theinterest of somebody else.
Juries have field days when itcomes to this, in terms of
punitives, discordion of fees isoften on the table, and coverage
can be a real problem becauseconflict claims don't arise
overnight.
And if you are reporting, youknow, every year that we're not
(29:13):
aware of anything, not aware ofanything, but there's been a
conflict problem kind of hangingthrough here. I've seen carriers
completely outright denycoverage because it wasn't
reported when a reasonablelawyer would have known that
this could potentially result ina claim. Now, one of the things
that I would share other than tojust say you really need folks
(29:36):
to take conflict problems very,very seriously. But let me talk
about, you know, a commonapproach to try to deal with
this is just informed consent,you know, just have a waiver
signed. I don't have a problemwith that, but I do want to
underscore really what a waiveris about.
We will see at times disclosurestatements. I have been
(29:58):
disclosed to the joint clientsor whatever, however this is
playing out, you know, theexistence of a conflict and they
agree to move forward. That'snot informed consent. You really
need to set forth, and I woulddo this in writing every time,
the pros and the cons of movingforward with the conflict in
(30:18):
play. How will this impact thesevarious parties?
What are the legal ramificationsof perhaps going into joint
representation? You know, if aconflict evolves down the road
in joint representation, illegalramification is going to be at
(30:40):
times you're out for all andthey're going to have to all go
get individual attorneys. Theyneed to be aware of that. They
need to be aware that there's noprivilege between joint clients.
That's another example.
So there's lots of stuff there,but that is a huge concern. And
(31:02):
I will tell you, I've got tokind of jump to what I think is
the biggest malpractice risk ofall. The ABA has a standing
committee on lawyersprofessional liability
insurance, and every four years,and they've been doing this
side, I don't know, since theearly nineties, mid nineties,
somewhere in there, they issuethis report. And insurance
(31:25):
companies, both The UnitedStates and Canada, and a number
of insurance carriers of allshapes and sizes participate in
just supplying data. And itgives you a national picture of
what's happening and you canlook at what is frequent, what
is, you know, and all thisstuff.
That's not telling you what thetrue cause of malpractice is.
That's telling you what themisstep is. The true cause is
(31:48):
something different. And you'renot going to find this in any of
the data. And really, you haveto start to ask yourself, well,
why is the matter beingneglected?
Why do some of these dates getblown? And why do conflicts get
ignored? And on and on. And I'mtelling you, in my mind, and
(32:11):
there's some, there are a lot ofpeople that agree with me, 50 to
even as high as seventy percentof claims have an impairment
issue in play. It could be, andI'm going to broadly define
that, it's obvious things likeburnout, stress, drug addiction,
(32:33):
any kind of, yeah, all types ofaddictions.
And I've worked with numbers oflawyers with all kinds of
addiction. Mental illness isanother problem. What is a
serious issue more and morewe're seeing in recent years,
and it's growing incrediblyfast, is dementia. In our
profession, this is a seriousproblem. Depression is a very
(32:55):
serious problem in ourprofession.
So that is the reason why that'sthe true cause of malpractice.
And the number one thing thatyou can do is simply prioritize
wellness. You know, take care ofyourself, nurture your support
systems, get out of the officenow and again, if you're, if I
(33:18):
get that sometimes you have toburn the candle at both ends and
there's an eighty, a hundredhour work week and sometimes,
you know, a big trial, you know,it can get wild, but you can't
keep that up year after year.You have to have vacations. You
have to have a life outside ofthis.
Otherwise, you will at somepoint be a statistic. You also
(33:40):
have to recognize when it's timeto quit. We have seen multiple
claims, you know, with dementiaand depression where it's ten,
fifteen, twenty. The highestI've seen is sixty six claims
with one person that had abreakdown during COVID. Wow.
And just neglected all kinds ofmatters.
Davina (34:00):
So I think, so it's interesting that you bring up
dementia because, so one of thethings I'm big on is really
encouraging solo attorneys togrow their firms. That because
when it's a solo, it is you andyou're but when you have a firm,
have a team, you have otherlawyers, you're spreading some
of this out. You are not you andyour team are able to help each
(34:24):
other and it's not gonna be suchan overwhelming, we're taking on
way more than we can handle,right?
Mark (34:30):
Yes.
Davina (34:31):
But it's interesting you bring up dementia because the
other thing I see is I talk to alot of lawyers and they're not
even thinking about retiring.There's that joke, oh, lawyers
don't retire. They just die attheir desk.
Mark (34:43):
I've seen that too many times and it's a mess.
Davina (34:46):
Right. I'm just like, why in the world do you not have
some point where you say, youknow, I'm not going to be an
active lawyer doing this. I canstill have my law license. I can
still see a buddy every now andthen and help him out. But I'm
gonna have other interests andother things I do.
(35:06):
And if people think, I mean, I'mI'm about to turn 60 and my
parents are in their mideighties. And I think to myself,
people think, oh, I'm just gonnawork until I just die. And then
you're like, I look at myparents and I go, they're they
couldn't do any of the thingsthat I do in my day to day life
(35:27):
because you lose capability asyou get older. You lose
awareness of your capability asyou get older. So you really
need to have a plan to developyour financial future so you
have some security for thefuture.
How many solos have you met whojust don't really have an
investment for the future? Theydon't have an asset they could
(35:49):
sell. They just keep working,money comes in, they pay the
bills, and then the mentalhealth suffers because they
don't have any other, that istheir wife, that's their
identity.
Mark (36:00):
This underscores in my mind to kind of add on to what
you're saying, you know, get asuccessor, name a successor. And
this could also be a backupattorney for you. So you can
have an opportunity to get outof the office and take the
occasional staycation or, youknow, long weekend down at the
beach or whatever, Climb themountain in Denver, outside
(36:22):
Denver, some beautiful countryout there. So get a backup, name
a successor. And that I wouldargue, and if you read the
rules, you know, 1.3, thecommentary to 1.3 diligence, a
number of jurisdictions reallysay, and it's really not
(36:44):
optional for a solo, you reallyneed to, you know, because
dementia, age, and we could evenadd in work from home, there are
no exceptions to the rules forthese circumstances.
Know, no work from homeexception to confidentiality or
competency. There is no I'mgetting older exception to this.
Know, you just move You've gotto do this. It's just not
(37:06):
optional.
Davina (37:07):
Well, and the mental health piece, I think a lot of
We have a younger generationthat's talking a lot about
mental health now, and they'resaying, want work life balance
and mental health, And it's astruggle for those of us who
sort of own a little older andown law firms and go like, What
are you talking about? I've beengrinding since I was 16, you're
coming in here fresh out of lawschool telling me you need this
(37:29):
work life balance. But to theircredit, that is something that
we all need to do a little bitbetter on. I think a lot of way
to do that is having, like yousaid, other support. Developing
a team, having other people tohelp us.
Give me an idea of, I would saythree preventative measures. I
(37:49):
know we've talked about some inour conversations, but if you
said, you know, here are threepreventative measures that I
would recommend for most solosout there, what kinds of things
would they be?
Mark (38:00):
I need to underscore yet again the number one thing that
I would say to preventmalpractice claims and
disciplinary problems areprioritizing wellness, taking
care of yourself. That'sabsolutely going to be number
one. Two, I would really focuson documentation, file
(38:24):
documentation. You know, there'sno perfect file out there, but
we see a lot of files that arejust a complete mess, missing
all kinds of things because theydon't really understand, well,
what should we be documenting?What is the And here's the
(38:44):
easiest way I can explain thisis the goal is to create a
record of the advice being givenand the decision making process.
If you capture that, you'regoing to have a pretty thorough
file, But now start to thinkabout how do we capture all of
(39:04):
this, you know, substantiveemails, substantive text
messages, you know, all of thisstuff needs to be preserved. And
it can all be digital, I don'tcare,
Davina (39:15):
but
Mark (39:14):
really But
Davina (39:15):
we need a way to get it in the client file so it just
doesn't live on your or live inyour email. Yes,
Mark (39:20):
because what we see a lot are word against word. It could
even be as simple as scope, ordid the representation end and
when did it end? In terms of aclosure letter. If you don't
have a closure letter or anengagement document that pins
down scope, we're going to havethis argument. You're still my
lawyer or I didn't agree to dothat.
(39:41):
Know, lawyers are always sayingit's very limited scope and the
clients are always saying, no,no, no, it's way If you don't
have a writing, assume you'regoing to lose. Okay. It is your
responsibility to document. Sowellness file documentation.
Beyond that, you know, we couldgo in all kinds of directions.
(40:04):
You know, I think one of thethings that I would add is be
very careful about just casualadvice. And that can come up in
all kinds of situations, whetherit's casual advice with, you
know, somebody attending asocial function and, you know,
talking a little law, helping afamily friend out, you know, and
(40:29):
it's kind of like a favor. Andlawyers can get very casual
about this, and sometimesdeadlines blow and sometimes,
you know, they just forget aboutit. A lot of times they're not
asking all the questions,they're just, because this isn't
real legal work, you know, thisis casual, and there's no fee
(40:52):
agreement, there's no moneybeing exchanged. So really what
we're talking about here is theaccidental client problem.
All I can say is they are very,very real. So be careful about
the accidental client. Maybe afinal one might be don't dabble,
don't shoot from the hip, know,don't let, and you'll see this
(41:14):
more and more as you get olderbecause we have these long term
clients. And oh Mark, I justneed you to do, I know this
isn't the type of law you'vebeen practicing, but I don't
want to lose this good clientand I'm going to try to figure
it out and you know you don'tknow what you don't know better
to associate
Davina (41:32):
with another attorney with us. I had a mentor when I
was starting who told me that hewas really good at saying,
Contact me at the office. Ican't answer that. It's too
vast. It's too detailed.
Contact me in the office. Andpeople then knew we have to make
(41:54):
an appointment. Have go through
Mark (41:55):
the
Davina (41:55):
routine of our process. I think processes are so
important to protect us forsure. And go ahead.
Mark (42:06):
I have a little story on one of these accidental clients
if you'd like to hear it.
Davina (42:09):
Yeah, I'd love to. And I was going to ask you if you'd
share something you and I talkedbefore about some things where
people have lost their lawfirms. And I think as a
cautionary tale, I'd love foryou to share a story about that
too. But tell me about thissituation with accidental Here's
Mark (42:23):
the accidental client, and this is just a classic example,
and it's a cocktail party claim.And this truly is real. There
was a lawyer at a socialfunction and she does not do
personal injury work. Her firmdoes not do personal injury
work, but another guest learnedthat there was a lawyer here and
they just started chatting, youknow, sipping on the wine and
(42:45):
those kinds of things. Andthat's fine.
If you enjoy a glass of wine,God bless. And it turned out it
was a personal injury situationand the lawyer said, we don't do
personal injury work. It soundsto me like you've got a good
case here and I certainly would,you know, refer a few names,
hear some lawyers or hear somefirms in town that do this kind
(43:07):
of work and I'd encourage you tospeak with them. Now just be
aware here in this state thestatute of limitations is two
years. Good luck with that.
So you got to get going on it.Well, she didn't ask all the
questions and she didn't knowwhat she didn't know. It turned
out this individual did shortlythereafter go out and try to
(43:29):
find somebody and by the time itall happened it was a little
over six months and the statutewas six months. There was an
exception in play and so therewas a lawsuit out of that and
the lawyer and the firm said,Woah, woah, woah, woah, there's
no fee agreement. We didn'tintend to form an attorney
client relationship.
(43:50):
You know, shhh. Nope. It's allabout if a reasonable person is
responding to the exchange as ifthey're receiving some legal
advice about their issue andit's reasonably foreseeable that
they're going to act or rely onthis advice in some fashion,
you've created an attorneyclient relationship and you're
going to be held to the accuracyof that and there was a loss
(44:12):
paid. So that's just an exampleof That's
Davina (44:16):
huge, that's huge. One of the things that I see happen
a lot, and I don't know ifyou've read any of these groups,
but on Facebook is an example. Alot of lawyer groups on
Facebook, A lot of lawyers goin. I remember mentors, just
older people very strongly,saying to me, we go to a bar and
(44:40):
sit and talk about our client'scase, even if we don't share
names. Cause you never knowwho's listening, you never know.
Mark (44:46):
And
Davina (44:49):
law school, drilled it in our heads. And I see so many
people go on social media ingroups with ten, twelve thousand
lawyers from all over thecountry, all over the world,
they don't know them, andthey're sharing a client's
confidences because they're madabout how somebody talked to
them or what they said, or canyou believe this? And they think
(45:12):
they're talking you know, withcolleagues about it, but they're
sharing it without sharingnames, but they don't know who
else is in that group who couldtake that information. Have you
ever had any claims or issuesaround social media and things
that come arise out of that?
Mark (45:27):
We have. I'm having trouble thinking of one
immediately where somebody wassharing something without names.
Where we have seen claims andlarge losses and loss of license
over it, is telling clients tomake something go away on social
(45:53):
media. Getting really uh-huh.
Davina (45:58):
Uh-huh. That's so interesting because I think
that's very common for a familylaw attorneys to say, go take
this down or personal injuryattorneys say, Take down that
picture of you dancing.
Mark (46:11):
Be very careful folks and make sure, you know, I've seen
lawyers disbarred for that, andwe have paid, our company has
paid in losses some significantdollars for that misstep. You
know, it was done. They werereally trying to hide
(46:32):
information and it, no.
Davina (46:34):
Did not go well. Not
Mark (46:36):
go well. You had asked though about, and if you want a
story about a firm going Wecould talk about different
stories here. I'll tell you thefirst one that comes to mind. A
(46:57):
lawyer was at a firm, and thisis, I don't know, maybe eight to
10 lawyers, and he knew that thefirm's antivirus security
software suite said it wasNorton. Okay?
So he's at the office oneafternoon and a pop up comes up
on the screen that says this isNorton antivirus, Your system is
(47:21):
infected. Please click here toinitiate a scan and that's, you
know, solve the problem. Heimmediately clicks on that and
then gets up and goes down thehall trying to find the IT guy.
Now they have outside IT. Personwasn't there.
(47:41):
Tried to get him on the phoneand, you know, and it took like
half an hour, forty five minutesor something to finally get in
touch with this person. And theperson said, are the computers
still working? And they said,well, oddly enough, no,
everything's down. So you werehit with ransomware, you know,
and they, this was bad,everything, including their
(48:06):
backups, because they kept theirbackups connected to the system.
You know, they were using theexternal drives that just, you
know, USBs and that kind ofthing.
So everything was infected andgone. And they had no idea how
to fix this and repair, and theywere playing around. The
security guy, I should say theIT guys tried to help, okay, but
(48:31):
they are not forensic experts,and they were
Davina (48:35):
trying Not cyber security experts.
Mark (48:36):
They are not cyber security people, and you know,
they are not trained to dealwith ransomware and all. These
are just sort of local guys.Sure they're good people, they
were way in over the head. Thelong story short is the time
period to come up with thecryptocurrency and pay the
ransom, it all expired. Theylost everything.
(48:58):
They could get nothing back. Asa result of this attack, the
firm did dissolve and break upbecause they couldn't afford the
losses and they could, I mean,it just blew up.
Davina (49:12):
The clients affected by this, oh my goodness. I can't
even imagine how.
Mark (49:18):
They lost everything.
Davina (49:19):
Well, how stressful that must have been for everybody
involved.
Mark (49:26):
Hear me clearly again, folks. It was all for just
clicking on a pop up. He thoughthe was doing the right thing.
Okay. What you need tounderstand is security systems
work by them selves.
You don't need to click onanything to do it. Was the same.
Davina (49:44):
Shouldn't be well, one of the things I we're always
getting, spam email. I mean,it's spammed all day long with
all kinds of things. And it'samazing how much something looks
like Capital One now orsomething looks
Mark (49:59):
like Oh yeah.
Davina (49:59):
Something looks like Bank of America. It all looks so
authentic. I've gotten some ofthose Norton ones. I always go
to the email and I look and see.I hover over that and I see what
the email is.
Mark (50:11):
Yep.
Davina (50:12):
That's a little tip. You can just see the email is, you
know, Sally's, you know, houseor whatever, it's got some sort
of weird.net. It's like, no,that's not the company. Also
just leaving the email and goingyourself and logging into
something to see if it's reallysending you an alert or if
(50:34):
that's scam. And most of ourscams, let's just put it that
way.
So that is terrifying. That isterrifying. And that happens
probably way more often than we
Mark (50:44):
think. Oh, does.
Davina (50:46):
Yeah. So what we talked about you have, I was very
surprised when I went on yourwebsite and I was looking, I'm
like, oh my gosh, they've gotlike nine to 12 different
coverages here. And your mainclients are solos and small
firms. So we're not talking bigfirms. So what do we need?
(51:09):
I mean, obviously, I thinkyou've got solo and small firm
owners who are like, well, Ican't afford. I mean, I'm
already paying high healthinsurance and high. Can't afford
everything that you offer. Solike, what are some things that
we really should think aboutthat we might need?
Mark (51:26):
Well, in my mind, you know, we've been talking about
two of the biggest. You know, Iwould not feel comfortable
practicing without a malpracticeinsurance policy, you know, and
you know, maybe your exposure's2 or 3,000,000 and you can't
afford that coverage. Okay, buy,you know, $25,500 or something.
(51:47):
Some coverage is better than nocoverage, you know. And so I
always would agree, you know,just buy what you can afford and
start there.
And then we'll see as thepractice evolves and hopefully
it becomes more and moresuccessful, you can adjust
accordingly. I would also neverpractice without cybersecurity,
cyber liability, I should say,cyber liability It's just
(52:12):
absolutely not. When I firststarted out in this industry,
you know, was all aboutmalpractice. Now, it's more
likely you're gonna be hit witha cyber event. It's not if, it's
when.
And the question is how bad whenthat happens.
Davina (52:26):
That's not true with
Intro (52:28):
my
practice.
Davina (52:27):
Me sick and sick in my stomach, because it's already,
we already are personallyvulnerable, but when you think
about the responsibility for allthese other people, you also,
tell me about business ownersbecause I think this is
something when we're dealingwith solo and small firms often
this, I mean, the solo is theonly lawyer and they're the
(52:48):
business owner and thensomething happens to them. Is
this something that you guysoffer or recommend? Well,
Mark (52:56):
owners, you know, are commercial liability. Know,
that's, we're really talkingabout slip, trip, and fall,
fire, that kind of thing forphysical space. What I heard you
saying, this is more, well, whatif I'm not here and what
happens? I would, you know, Ithink there's value in having a
(53:17):
key person life insurance orsomething like that to protect.
Because if you die at your deskand there's no successor,
there's a mess, and trust me,I've been on the phone with the
spouse, he or she is livid,absolutely livid, and also just
mourning and grieving, and itjust, know, how, why did they
(53:40):
not, I don't know what to dowith all this stuff.
I have built that, you know, andit can be expensive. So, you
know, key man or key personinsurance is a good If you have
physical space, I absolutelythink, you know, an office by
commercial package businessowners, a BOP business owners
policy. If it's, you know, ifit's all virtual, I don't know
(54:04):
that that's absolutelynecessary. That wouldn't be my
top priority, but. Yeah, yeah.
You know, another thing to thinkabout as you grow wealth, make
sure you have an umbrella onyour personal side because, you
know, you have a JD after yourname, you have some money, if
somebody slips on the ice out inyour home in Colorado or trips
(54:26):
on a court or something in heredown in Florida, they're gonna
come after you. And you know,the homeowners is not typically
enough. So put an umbrella of acouple million over, but that's
later on. Malpractice, cyber.
Davina (54:41):
Need to end this conversation because, I'm
learning so much and I thinkthis is such an important topic.
I may be bringing you back formore, but I want to know
particularly, we're gonna put alink in the show notes with
your, information. But I want toknow particularly how people can
(55:01):
find your CLEs or find moreeducation and information.
Mark (55:06):
All of that would be on the corporate website,
www.alpsinsurance.com. A finalthing that I can add, and my
email will be there. Let me justunderscore folks very quickly.
I'm not a traditional riskmanager. I'm not hired to manage
the risk of a corporation.
I'm not a CRO. I'm hired by Alpsto be a risk manager at the bar
(55:27):
at large. There's no fee tovisit with me. You don't need to
be an Alps insurer to visit withme. If there's something I can
do to help you stay out oftrouble or just do a little
education, ethics, insurance,cybersecurity, malpractice
appointments, whatever, feelfree to reach out.
Happy to help any of yourlisteners, Davina. Happy to
Thank
Davina (55:47):
you. Tell them you heard about him on Wealthy Moment
Lawyer. All right, Mark, thanksso much for being here. I've
really enjoyed our conversation.
Mark (55:54):
You're most welcome. Thanks for having me.
Intro (55:57):
If you're ready to create more of what you truly desire in
your business and your life,then you'll want to visit us at
wealthywomanlawyer.com to learnmore about how we help our
clients create wealth generatinglaw firms with ease.
Welcome to the wealthy woman lawyer podcast. What
Davina (00:05):
if
Intro (00:05):
you could hang out with successful women lawyers, ask
them about growing their firms,managing resources like time,
team, and systems, masteringmoney issues, and more? Then
take an insight or two to helpyou build a wealth generating
law firm. Each week, your host,Devina Frederick, takes an
in-depth look at how to thinklike a CEO, attract clients who
(00:25):
you love to serve and will payyou on time, and create a
profitable, sustainable firm youlove. Devina is founder and CEO
of Wealthy Woman Lawyer, and hergoal is to give you the
information you need to scaleyour law firm business from 6 to
7 figures in gross annualrevenue so you can fully fund
and still have time to enjoy thelifestyle of your dreams. Now
(00:48):
here's Devina.
Davina (00:50):
Hello, and welcome to the Wealthy Woman Lawyer
Podcast. I'm your host, DevinaFrederick, and my guest today is
Marc Bassingthwaite. Marc is anattorney who has worked as a
risk manager with Alps since1998. Alps is the nation's
largest direct writer oflawyers' malpractice insurance.
In his tenure with the company,Mark has conducted more than
1,200 law firm risk managementassessment visits, presented
(01:13):
over six fifty continuing legaleducation seminars throughout
The United States, and writtenextensively on risk management,
ethics, and technology.
He is a member of the State Barof Montana, as well as the
American Bar Association, wherehe currently sits on the ABA
Center for ProfessionalResponsibilities Conference
Planning Committee. He receivedhis JD from Drake University Law
(01:36):
School. Please join me inwelcoming Marc Bassenthwaite to
the Wealthy Woman Lawyerpodcast. Hi, Marc. Welcome.
It's good to see you today.
Mark (01:44):
Well, thanks for having me. It really is a pleasure to
be here.
Davina (01:47):
Good. How's the weather in Montana?
Mark (01:49):
Well, we just got back from Montana and it's a typical
Montana spring. I actually liveand work remotely. So I'm down
right outside of Orlando,Florida. Nice, so you're in my
old stomping grounds. Oh okay,
Davina (02:06):
yes. My listeners know that I lived in Orlando for like
forty years. I'm a nativeFloridian, and then I just moved
last year to Colorado, twentytwenty four or 2023 rather. So
anyway, all right, so we're allover the place. Look at us being
in this modern world.
So tell me a little bit aboutthe company you work for and
(02:30):
what it is that you do.
Mark (02:32):
Okay. The company is Alps, Alps Insurance. We've gone
through various names over theyears. We go back to the days of
Nabrico. In the early to late80s, or I should say mid to late
80s, legal malpractice insurancewas almost impossible to buy.
It was an extremely hard market,and several companies were
(02:55):
formed under some federalregulations called Nabrico,
National Association of BarRelated Insurance Carriers. And
from there, we've grown to benow a nationwide carrier. We've
left Nabrico years ago, but wedo all things for lawyers. It
started out being allmalpractice and only
(03:17):
malpractice. Now we do cyberliability, employment practices
liability, bonds, all types ofbusiness insurance.
So that's, you know, but it'sall just lawyers, that's all we
do. My job, and I've been in,I've had various titles, but
it's all been basically the samething, just as it evolves over
(03:39):
the years. I'm a risk managerright now, like sort of refer me
as the national risk manager.And what I do, I sort of
describe myself at times, I'm alawyer's lawyer, but I'm on the
proactive side. I do a lot oflecturing, a lot of writing.
(04:00):
Over the years earlier on, Iused to do a lot of consulting,
have consulted with over 1,200law firms of all shapes and
sizes from many, many solos upto about 120 lawyers. And my
visits would take anywhere fromhalf a day to a week depending
on the circumstances and thesize of the firm. But it's a lot
of education. Let's talk aboutwhat are your processes and
(04:22):
procedures? What are you doingin terms of security, in terms
of cybersecurity?
Doing a lot of wellnesseducation. So it's been a great
ride. I never in a million yearsthought I'd be in a chair like
this, but here I Yeah, I'mcurious.
Davina (04:39):
I'm curious because you are a lawyer. What led you to go
into the insurance side of it?
Mark (04:47):
Well, it's one of these crazy sort of happenstance
things. I truly never even knewthat jobs like this existed.
After law school, I was reallyset to go, well, should say
doing law school, was reallyheading toward litigation. But I
also had an interest ininsurance law and tax. And then
(05:09):
after law school, during lawschool was a little bit of a
move from Iowa to Montana, buthung up a shingle and was
starting down that path with apartner, a law school partner.
And somebody was building ahouse right behind us. We were
all in a new development, andthis gentleman was the first
(05:30):
risk manager at Alps. He was anon lawyer, but truly an
insurance guru. And we got totalking. He's telling me about,
you know, risk management andwhat this is all about.
And I looked at him and I said,you know, Bob, would you ever
consider having an attorney joinyou to do this? And he kind of
(05:51):
just jaw dropped. He said, Wait,lawyers would do this? I said,
Bob, if you advertise forlawyers, you're going to get a
line of people. And about, Iwould say almost a year later, I
got a call for advertising.
You've got to go through theprocess and there are other
lawyers in the queue, but I wasblessed that it worked out and
(06:13):
I've never looked back.
Davina (06:15):
Yeah, I think you have to have it's probably very
unique to have such an interestin risk management and insurance
and all of those kind of things,but it's probably been a really
rewarding career as well becauseyou probably learned things that
you never even thought about.
Mark (06:32):
You are so right. I kid around at times, but there's an
element of truth to this. One ofthe things I'm seriously
considering when I retire, andI've still got anywhere from, I
don't know, five to eight yearsleft. We'll see how it goes. But
I want to write a book, How Notto Practice Law, and just call
it Observations of a RiskManager, know, something like
(06:53):
that.
Davina (06:53):
Yeah, think that would be Tell
Mark (06:55):
some of these stories. Oh my Yeah.
Davina (06:58):
Well, I'm going get you to share some of those stories
today because I was approachedto have you on the show and I
thought, that is brilliant. Idon't know why I haven't had
anybody who talks aboutinsurance and risk management
liability for law firms andlawyers before, because this is
such a huge part of our businessthat a lot of us don't think
(07:20):
about until suddenly we get intotrouble. So I'm going to ask you
a lot of questions along theline. Hold on just one second so
we can cut this part out. Not ifyou're my dog.
So some of the questions I wantto ask you, I want to start out
talking about some of the mostcommon claims that you see every
(07:48):
year in the business and havethose changed over time?
Mark (07:52):
You would think that they would, and the answer is no.
I've been at this for twentyseven years and it's the same
old, same old on the malpracticeside. Now how some of these
arise can differ a little bit.Boy, one of the big ones, I
mean, in terms of the frequencypiece, you look at the national
(08:14):
data, it's going to be acalendaring misstep. They
continue to happen over and overand over again.
And you know, once you blow astatute, which is the ones that
really start to worry us becausethere can be a lot of exposure
on those, it's really, everyonce in a while you can do a
little claims repair, but mostof the time it's just how much.
(08:36):
They get very Can
Davina (08:39):
you give me an example of that?
Mark (08:41):
Well, let me tell you how one came up. It's an interesting
story, and there are a practicerisk tip or two here for your
listeners. So I'm going to dothis in the context of, and
again, this is a true story, butI'm going to pretend it's us. So
you'll be the lawyer and I'mgoing to be your paralegal, and
(09:02):
we do personal injury plaintiffwork. What we do is we have four
calendars and we think, youknow, we've got these multiple
systems and they're going todouble check, etc.
So, you have calendar on yourcomputer. Let's say you're using
(09:24):
CLIO or something and it syncsto the cloud. I have a day
timers desktop thing that's sortof my master calendar. And maybe
we have a digital or a papertickler system, okay? Now here's
our process.
I do everything. I open themail, I hit calendar from either
(09:48):
court or everything, and I'mputting everything in my book.
And then I copy that. I take itto the file room. I sit down at
your desk or I enter into your,you know, and put it in Clio.
So we think we have fourcalendars, we only have one. And
there's just these copies. Nowthe problem is, what if I make a
mistake? Okay. Now lawyers attimes will say, okay, I know I
(10:14):
should do some double checking.
So I'm going to watch Mark anddouble check. And we'll put this
second set of eyes. I want tocreate an independent countering
system. And so you say, I'mgoing to start watching what
Mark does. And over the nextyear, eighteen months, you're
double checking.
You're looking at my calendarentries or you're maintaining
(10:35):
your calendar separately. Youknow, you do the Clio and it
backs up, I do my book, and itcopies it to the file system or
the detector system. We bringthese together once a month or
whatever and do calendar review,and you never find any mistakes.
So you stop. And so now there'sno quality control again.
(10:58):
What happened in this situation,shortly after you stop, that's
three to six months something, Igot a call from my brother.
Mom's just had a stroke. It isnot good. You need to get out
here quickly. Oh my gosh, lifeis happening on overdrive.
It's just, I'm doing as much asI can as quickly as I can to
(11:21):
minimize the impact of thisunexpected departure. I'm trying
to get airplane tickets. Who'sgoing take care of the dog? What
about the kids? Life is on highI make a mistake then.
It just happens. People makemistakes from time to time. So
the lesson here is, you know, weneed to have independent, and
(11:44):
see, then that mistake was notcaught until after the statute
ran, because it wasmiscallendered. We need to have
independent systems, you know,so you do your piece, I do my
piece, or I do it all and youlook at original documents and
double check my entries, etc, tomake sure it's correct. It's not
(12:06):
about competency.
This is about a quality controlprocess to ensure the competent
on time delivery of all theservices that we are getting
involved in and delivering. Soindependent calendaring is an
extremely important useful tool,and there are a hundred ways to
(12:26):
do it, but you need to have trueindependence, and that can
prevent these kinds of mistakes.So that's sort of the frequency
piece. If you're interested
Davina (12:36):
And just to go into that, so what happened is the
ball got dropped for the client,statute of limitations ran, and
then we're out of luck, and theclient's out of luck, and you've
really screwed up, even thoughyou didn't mean to, and it was
all an innocent mistake. Soprocesses and systems are key
with your calendaring and havingsomething that's independent,
(12:58):
that's not dependent on sort ofthis one person without some
checks and balances. All right,good, good. Thanks for sharing
that. So what other kinds ofthings?
I know one thing that I think ofwhen I think of liability is
always because we hear thisdrilled into us from the Bar
Association and that is alwaysabout things like trust
accounts. Is that somethingthat's a big claims issue or
(13:23):
what other kinds of things?
Mark (13:24):
Well, that raises a really interesting dilemma that a lot
of lawyers aren't thinkingabout. So I'm going to come at
this in two ways. Are trustaccount missteps a significant
problem in our profession? Andthe answer to that would be yes,
primarily on the disciplineside. We're just too lax.
(13:49):
Sometimes there's, you know, abounced check or something in a
number of states. Banks arerequired to automatically report
that to the bar, and thenthere's a little investigations
and things. Sometimes there'sjust random audits. And as a
profession, we do not have trustaccounting down. There are some
firms that do a really, reallygood job, but, you you can't
(14:11):
just close your eyes to this andsay, don't need to worry about
it.
I'm just gonna have a bookkeeperor a CPA and let them do it. I
mean, there are rules in play,and you must follow them and
it's your license on the line ifthere's a problem. So that's
sort of the first half. Wheretrust accounts and actually goes
a little broader. We could talkabout the firm's operating
(14:33):
account as well, but trustaccount, there's a lot of time
where we are moving moneythrough the trust account,
right?
Whether it's, know, again, asettlement check, lots of times
money's moving through here. Thereal risk on trust account is
cybercrime. And here's what alot of lawyers don't know. I go
(14:55):
out and I buy a malpracticepolicy and it's going to cover
me for everything that I do as alawyer. That is simply not true.
There are lots of exclusions andlots of situations where it
isn't going to cover you. Thisis one. The vast majority of
malpractice policies providelittle to no, sometimes there
might be a sublimit in play, butlittle to no coverage for these
(15:18):
types of financial losses. So ifyou're scammed, business email
compromise scam, a wire fraudscam, and folks please hear me
very clearly. This is notlimited to real estate lawyers.
If you are moving money, I'veseen every type of lawyer that
moving money get hit. It's now,yes, real estate lawyers are
(15:39):
getting hit more often, but I'veseen this in multiple practice
settings. So the way to thinkabout this is if you are scammed
and you've wired some money orsomething, that is a property
loss. It is not negligence. Sothat's sort of the simple, easy
way just to think about it.
Can you insure for that?Absolutely you can, but it's not
(16:04):
malpractice policy. And I haveseen lawyers take hits in the
half million, million, millionplus. Wow. You know, where they,
some of these situations Becauseit's
Davina (16:17):
not covered by their malpractice insurance, their
general malpractice insurance.
Mark (16:21):
But they're liable for the loss.
Davina (16:23):
Let's talk some about the cybercrime because I had a I
was talking to a client aboutit, I was concerned about, so a
lot of law firms are workingremote and they're hiring people
and the people are working outof their houses. I was talking
about issuing equipment insteadof having them use their own
equipment as employees, and kindof the dangers of them using
(16:46):
their own equipment. It's maybea family computer that junior
gets on and starts playinggames, there's a problem. You
know, they open it up to,potential, cybercrime hacking or
whatever, or just somebody'sseeing something. And then also,
at kind of her response, I mean,which we were talking about,
(17:08):
well, know, I'm uploading, it'sall coming up to the cloud, The
the case management software isall on the internet.
It's all uploading to the cloud.The equipment is just like, you
know, kind of like we used tohave the dummy equipment, and it
all went to servers. Right? Youknow, this sort of idea and and
(17:30):
this belief that I'm small fry.Hackers are not gonna be coming
for me.
These ransomware hackers thatyou hear about, they're not
gonna be coming for me. And soreally not a lot of concern. And
and she's very her statementswere very common, what I've
heard other people say. So whatwould you say to that?
Mark (17:51):
She's wrong on every one of these points. First off, size
has nothing to do with it. Manyof these ransomware attacks are
sort of software as a servicetype companies, and they are
hitting anybody and everybody.If they hit and because these
(18:12):
they're directing it just towhoever falls prey, okay? So if
you hit a solo small firm asopposed to, you know, one of the
global firms or something, theransom amount that they're going
to demand is going to bedifferent because they
understand, you know, this is asolo lawyer, but they'll take
(18:34):
whatever they can get in anysituation.
So ransomware is not directeduniquely at large, it's directed
at the masses. It's allautomated, AI is now getting
involved, and it is not goodfolks. The belief that we're too
small to be on anybody's radaris also woefully mistaken. I've
(19:00):
shared with ransomware as anexample, these are automated
attacks, so it doesn't matter.But when it comes to other types
of attacks, small businesses andparticularly solo small firm
lawyers are highly preferredtargets for a number of reasons.
Two are that we have a lot ofthe same information, valuable
(19:20):
information, you know,personally identifiable
information. There are differenttypes of secrets and confidences
that can be monetized. And two,we don't have the tech savvy and
the financial wherewithal toproperly secure our systems in
the same way that a largecorporation could as an example.
(19:40):
So high profile targets, this isthe low hanging fruit. You know,
we sell cyber insurance, and I'mtelling you we see a lot of
claims, and our market is allsolo and small firms.
You know, we're The large firmsinsure themselves sort of in
slightly different channels indifferent ways. We see a lot of
Davina (20:05):
claims. Are we seeing people hacking in and taking
client information that kind ofthing is that what we're seeing
a lot of or is it?
Mark (20:13):
Yeah, yeah, ransomware and wire fraud are very very common,
but we do see and here'ssomething else I want you folks
to understand. We talk about inthe security space,
(20:35):
professionals don't hackcomputers, they log in, okay,
because the scams are sosophisticated, these phishing
scams, and they'll get in and,you know, they can do all kinds
of things. And we'll think forinstance, ransomware. We still
(20:57):
believe that ransomware is allabout encrypting the data and we
have to pay ransom to get itback. They're holding our data
ransom.
And now that's still verycommon, but that's not the end
game anymore. What they're doingis they're holding, they go in
and take all your data out, havecopies of it in other words, and
(21:21):
then they encrypt, and then theycome back and say, well, we want
money to decrypt. You pay themoney and you may or may not get
your data back, but let's sayyou do. Then a little bit later,
you're going to get anotherransom. Oh, we have all your
data and we're going to sell iton the deep web or the dark web,
whatever you want to call Unlessyou pay us another ransom and
(21:42):
you pay that and then they stilldon't delete.
I mean, these are bad people,you know, so there's lots and
lots of stuff going on there.
Davina (21:50):
Never ending. My husband, for about twenty five
years, worked doing IT tech forinsurance defense firms all
throughout the Southeast and hehad some all over the country.
One of the things he said was avulnerability, was a big
vulnerability people didn'trealize would be the, at the
(22:13):
time, secretaries, assistants,paralegals, who wanted to have
the butterfly screensaver or theJesus screensaver on her
computer and didn't realize thatthat created a vulnerability for
people to access the computersthat weren't at the law firm.
(22:33):
And so many things like that, Ithink that a lot of people don't
think of is that your employeesare often pass into your system
because they fall, like you say,they fall prey to these sort of
phishing scams. They're clickingon links in emails, and there's
a lot of that sort of in policythat we need to be addressing
(22:56):
saying this is what we do, iswhat we don't do.
Go
Mark (22:59):
ahead. So let me circle back to an earlier comment you
talked about, know, there's alsothis belief that, you know, it's
phone computers and whereeverything's in the cloud and
there's a Folks, what you needto hear clearly and I, you know,
I my cell phone. This is mypersonal phone, but it's also
used for work. I've been workingremotely for over fifteen years
(23:21):
now and all of this equip,almost all of it, is all mine.
Now I have a lot of things thatI need to do to keep this very
secure because we're a regulatedcompany, but that's also, I'm
just a little paranoid and so Ido a lot of things that other
people don't But this is theweak stuff folks, this is what
(23:43):
you need to hear.
You know, the modern day threatback in the day and I get it,
know, the butterfly screensaverswere risky certain Now it's the
personal smartphone that's usedfor work. It's the same thing.
And any individual at your firm,even if it's just two people, so
you and a secretary, You know,the person that is not fully
(24:09):
secure both on socialengineering awareness training,
understanding what the currentphishing attacks look like,
understanding what attacks looklike on the smartphones. And
hear me clearly folks,smartphones are a high profile
target. More and more attacksare going to the mobile space
than just about anything elsebecause this is, we all treat
(24:32):
this stuff in a different way.
We don't think a text messagewould, you know, can be used to
fish us out of some information,and absolutely it can. Identity
theft is very easy to occur.Bank account access, very easy
to occur,
Davina (24:48):
using these media apps you're signing up for, you're
giving permission to accesseverything on your phone, from
your microphone to your bankaccounts that you have attached
to an app phone. Highlyvulnerable places. If your
paralegal has an app on herphone to access a case
(25:13):
management system and she alsohas TikTok or some other social
media. It could be meta for allI know, right? Meta certainly
gets access to everything, It'sjust not the Chinese government.
But that there's a vulnerabilityin that. Who's accessing this?
(25:33):
Who's who's able to get thisinformation? It could be some
employee that works for one ofthese companies that so they or
games are a huge thing. How manypeople let their kids use their
phones to play games?
And if they're doing businessand personal on that phone,
that's a problem.
Mark (25:50):
It is. It's a huge problem. Here's what people
don't think about. You know, inmy mind, nothing in life is
free. I used to, when our kidswere still young, I'd say, I'd
try to teach them, you get whatyou pay for.
Well, whether it's gaming apps,all kinds of apps that we put on
our devices, our mobile devices,and you think, well, why is it
(26:14):
free? I assure you it's verycostly to develop these apps and
these games. There's a lot ofmoney here, but they're giving
it away. Well, why? Because whenyou get it for free, the one
thing they ask is we have accessto everything going on on your
phone and we are going tomonetize that.
(26:38):
And the information that theyare pulling off these phones and
laptops and tablets and all the,you know, is extremely valuable.
They are making gobs of money atthis. You know, again, think
about Facebook, how much moneythey make. Did you pay for that
(26:59):
app? No, no, no.
Right? Just saying. And
Davina (27:02):
so as law firm owners, what I think we're talking
about, I mean, there's obviouslyyour personal vulnerability, as
law firm owners, you have anobligation to your clients to
keep their informationconfidential. And so if Betty
Sue, who works in your office,has an app on her phone, and the
(27:26):
company who makes the app maysay that's a very secure app,
but you wonder if she's got thatand also some games on it and
some social media on it. Are youexposing your clients to being
hacked? And we see it all thetime with large companies. I
mean, why do we think we're anexception to that rule?
(27:48):
And lawyers, I think areparticularly targeted, even
though we don't realize it,because we, small firms are
going to be a little moreuneducated about those types of
things. We're busy trying tojust run a business. We're not
thinking about this. And then wehold such powerful confidential
information all the way fromsocial security numbers to birth
(28:12):
dates and all the ages of theirkids. Mean, like everything
right out there.
So, all right. So, is thereanother area that you really
want to tell us about that issomething that we really need to
be paying attention to in termsof the most claims that you're
seeing?
Mark (28:31):
Well, I would say what we could talk about, conflicts of
interest. You know, I shared atthe beginning calendaring is the
severity piece, or I'm sorry,the frequency piece. Conflicts
of interest claims are theseverity piece. And these things
just always boil down to greedyattorney putting his or her
(28:52):
financial interests about theinterest of somebody else.
Juries have field days when itcomes to this, in terms of
punitives, discordion of fees isoften on the table, and coverage
can be a real problem becauseconflict claims don't arise
overnight.
And if you are reporting, youknow, every year that we're not
(29:13):
aware of anything, not aware ofanything, but there's been a
conflict problem kind of hangingthrough here. I've seen carriers
completely outright denycoverage because it wasn't
reported when a reasonablelawyer would have known that
this could potentially result ina claim. Now, one of the things
that I would share other than tojust say you really need folks
(29:36):
to take conflict problems very,very seriously. But let me talk
about, you know, a commonapproach to try to deal with
this is just informed consent,you know, just have a waiver
signed. I don't have a problemwith that, but I do want to
underscore really what a waiveris about.
We will see at times disclosurestatements. I have been
(29:58):
disclosed to the joint clientsor whatever, however this is
playing out, you know, theexistence of a conflict and they
agree to move forward. That'snot informed consent. You really
need to set forth, and I woulddo this in writing every time,
the pros and the cons of movingforward with the conflict in
(30:18):
play. How will this impact thesevarious parties?
What are the legal ramificationsof perhaps going into joint
representation? You know, if aconflict evolves down the road
in joint representation, illegalramification is going to be at
(30:40):
times you're out for all andthey're going to have to all go
get individual attorneys. Theyneed to be aware of that. They
need to be aware that there's noprivilege between joint clients.
That's another example.
So there's lots of stuff there,but that is a huge concern. And
(31:02):
I will tell you, I've got tokind of jump to what I think is
the biggest malpractice risk ofall. The ABA has a standing
committee on lawyersprofessional liability
insurance, and every four years,and they've been doing this
side, I don't know, since theearly nineties, mid nineties,
somewhere in there, they issuethis report. And insurance
(31:25):
companies, both The UnitedStates and Canada, and a number
of insurance carriers of allshapes and sizes participate in
just supplying data. And itgives you a national picture of
what's happening and you canlook at what is frequent, what
is, you know, and all thisstuff.
That's not telling you what thetrue cause of malpractice is.
That's telling you what themisstep is. The true cause is
(31:48):
something different. And you'renot going to find this in any of
the data. And really, you haveto start to ask yourself, well,
why is the matter beingneglected?
Why do some of these dates getblown? And why do conflicts get
ignored? And on and on. And I'mtelling you, in my mind, and
(32:11):
there's some, there are a lot ofpeople that agree with me, 50 to
even as high as seventy percentof claims have an impairment
issue in play. It could be, andI'm going to broadly define
that, it's obvious things likeburnout, stress, drug addiction,
(32:33):
any kind of, yeah, all types ofaddictions.
And I've worked with numbers oflawyers with all kinds of
addiction. Mental illness isanother problem. What is a
serious issue more and morewe're seeing in recent years,
and it's growing incrediblyfast, is dementia. In our
profession, this is a seriousproblem. Depression is a very
(32:55):
serious problem in ourprofession.
So that is the reason why that'sthe true cause of malpractice.
And the number one thing thatyou can do is simply prioritize
wellness. You know, take care ofyourself, nurture your support
systems, get out of the officenow and again, if you're, if I
(33:18):
get that sometimes you have toburn the candle at both ends and
there's an eighty, a hundredhour work week and sometimes,
you know, a big trial, you know,it can get wild, but you can't
keep that up year after year.You have to have vacations. You
have to have a life outside ofthis.
Otherwise, you will at somepoint be a statistic. You also
(33:40):
have to recognize when it's timeto quit. We have seen multiple
claims, you know, with dementiaand depression where it's ten,
fifteen, twenty. The highestI've seen is sixty six claims
with one person that had abreakdown during COVID. Wow.
And just neglected all kinds ofmatters.
Davina (34:00):
So I think, so it's interesting that you bring up
dementia because, so one of thethings I'm big on is really
encouraging solo attorneys togrow their firms. That because
when it's a solo, it is you andyou're but when you have a firm,
have a team, you have otherlawyers, you're spreading some
of this out. You are not you andyour team are able to help each
(34:24):
other and it's not gonna be suchan overwhelming, we're taking on
way more than we can handle,right?
Mark (34:30):
Yes.
Davina (34:31):
But it's interesting you bring up dementia because the
other thing I see is I talk to alot of lawyers and they're not
even thinking about retiring.There's that joke, oh, lawyers
don't retire. They just die attheir desk.
Mark (34:43):
I've seen that too many times and it's a mess.
Davina (34:46):
Right. I'm just like, why in the world do you not have
some point where you say, youknow, I'm not going to be an
active lawyer doing this. I canstill have my law license. I can
still see a buddy every now andthen and help him out. But I'm
gonna have other interests andother things I do.
(35:06):
And if people think, I mean, I'mI'm about to turn 60 and my
parents are in their mideighties. And I think to myself,
people think, oh, I'm just gonnawork until I just die. And then
you're like, I look at myparents and I go, they're they
couldn't do any of the thingsthat I do in my day to day life
(35:27):
because you lose capability asyou get older. You lose
awareness of your capability asyou get older. So you really
need to have a plan to developyour financial future so you
have some security for thefuture.
How many solos have you met whojust don't really have an
investment for the future? Theydon't have an asset they could
(35:49):
sell. They just keep working,money comes in, they pay the
bills, and then the mentalhealth suffers because they
don't have any other, that istheir wife, that's their
identity.
Mark (36:00):
This underscores in my mind to kind of add on to what
you're saying, you know, get asuccessor, name a successor. And
this could also be a backupattorney for you. So you can
have an opportunity to get outof the office and take the
occasional staycation or, youknow, long weekend down at the
beach or whatever, Climb themountain in Denver, outside
(36:22):
Denver, some beautiful countryout there. So get a backup, name
a successor. And that I wouldargue, and if you read the
rules, you know, 1.3, thecommentary to 1.3 diligence, a
number of jurisdictions reallysay, and it's really not
(36:44):
optional for a solo, you reallyneed to, you know, because
dementia, age, and we could evenadd in work from home, there are
no exceptions to the rules forthese circumstances.
Know, no work from homeexception to confidentiality or
competency. There is no I'mgetting older exception to this.
Know, you just move You've gotto do this. It's just not
(37:06):
optional.
Davina (37:07):
Well, and the mental health piece, I think a lot of
We have a younger generationthat's talking a lot about
mental health now, and they'resaying, want work life balance
and mental health, And it's astruggle for those of us who
sort of own a little older andown law firms and go like, What
are you talking about? I've beengrinding since I was 16, you're
coming in here fresh out of lawschool telling me you need this
(37:29):
work life balance. But to theircredit, that is something that
we all need to do a little bitbetter on. I think a lot of way
to do that is having, like yousaid, other support. Developing
a team, having other people tohelp us.
Give me an idea of, I would saythree preventative measures. I
(37:49):
know we've talked about some inour conversations, but if you
said, you know, here are threepreventative measures that I
would recommend for most solosout there, what kinds of things
would they be?
Mark (38:00):
I need to underscore yet again the number one thing that
I would say to preventmalpractice claims and
disciplinary problems areprioritizing wellness, taking
care of yourself. That'sabsolutely going to be number
one. Two, I would really focuson documentation, file
(38:24):
documentation. You know, there'sno perfect file out there, but
we see a lot of files that arejust a complete mess, missing
all kinds of things because theydon't really understand, well,
what should we be documenting?What is the And here's the
(38:44):
easiest way I can explain thisis the goal is to create a
record of the advice being givenand the decision making process.
If you capture that, you'regoing to have a pretty thorough
file, But now start to thinkabout how do we capture all of
(39:04):
this, you know, substantiveemails, substantive text
messages, you know, all of thisstuff needs to be preserved. And
it can all be digital, I don'tcare,
Davina (39:15):
but
Mark (39:14):
really But
Davina (39:15):
we need a way to get it in the client file so it just
doesn't live on your or live inyour email. Yes,
Mark (39:20):
because what we see a lot are word against word. It could
even be as simple as scope, ordid the representation end and
when did it end? In terms of aclosure letter. If you don't
have a closure letter or anengagement document that pins
down scope, we're going to havethis argument. You're still my
lawyer or I didn't agree to dothat.
(39:41):
Know, lawyers are always sayingit's very limited scope and the
clients are always saying, no,no, no, it's way If you don't
have a writing, assume you'regoing to lose. Okay. It is your
responsibility to document. Sowellness file documentation.
Beyond that, you know, we couldgo in all kinds of directions.
(40:04):
You know, I think one of thethings that I would add is be
very careful about just casualadvice. And that can come up in
all kinds of situations, whetherit's casual advice with, you
know, somebody attending asocial function and, you know,
talking a little law, helping afamily friend out, you know, and
(40:29):
it's kind of like a favor. Andlawyers can get very casual
about this, and sometimesdeadlines blow and sometimes,
you know, they just forget aboutit. A lot of times they're not
asking all the questions,they're just, because this isn't
real legal work, you know, thisis casual, and there's no fee
(40:52):
agreement, there's no moneybeing exchanged. So really what
we're talking about here is theaccidental client problem.
All I can say is they are very,very real. So be careful about
the accidental client. Maybe afinal one might be don't dabble,
don't shoot from the hip, know,don't let, and you'll see this
(41:14):
more and more as you get olderbecause we have these long term
clients. And oh Mark, I justneed you to do, I know this
isn't the type of law you'vebeen practicing, but I don't
want to lose this good clientand I'm going to try to figure
it out and you know you don'tknow what you don't know better
to associate
Davina (41:32):
with another attorney with us. I had a mentor when I
was starting who told me that hewas really good at saying,
Contact me at the office. Ican't answer that. It's too
vast. It's too detailed.
Contact me in the office. Andpeople then knew we have to make
(41:54):
an appointment. Have go through
Mark (41:55):
the
Davina (41:55):
routine of our process. I think processes are so
important to protect us forsure. And go ahead.
Mark (42:06):
I have a little story on one of these accidental clients
if you'd like to hear it.
Davina (42:09):
Yeah, I'd love to. And I was going to ask you if you'd
share something you and I talkedbefore about some things where
people have lost their lawfirms. And I think as a
cautionary tale, I'd love foryou to share a story about that
too. But tell me about thissituation with accidental Here's
Mark (42:23):
the accidental client, and this is just a classic example,
and it's a cocktail party claim.And this truly is real. There
was a lawyer at a socialfunction and she does not do
personal injury work. Her firmdoes not do personal injury
work, but another guest learnedthat there was a lawyer here and
they just started chatting, youknow, sipping on the wine and
(42:45):
those kinds of things. Andthat's fine.
If you enjoy a glass of wine,God bless. And it turned out it
was a personal injury situationand the lawyer said, we don't do
personal injury work. It soundsto me like you've got a good
case here and I certainly would,you know, refer a few names,
hear some lawyers or hear somefirms in town that do this kind
(43:07):
of work and I'd encourage you tospeak with them. Now just be
aware here in this state thestatute of limitations is two
years. Good luck with that.
So you got to get going on it.Well, she didn't ask all the
questions and she didn't knowwhat she didn't know. It turned
out this individual did shortlythereafter go out and try to
(43:29):
find somebody and by the time itall happened it was a little
over six months and the statutewas six months. There was an
exception in play and so therewas a lawsuit out of that and
the lawyer and the firm said,Woah, woah, woah, woah, there's
no fee agreement. We didn'tintend to form an attorney
client relationship.
(43:50):
You know, shhh. Nope. It's allabout if a reasonable person is
responding to the exchange as ifthey're receiving some legal
advice about their issue andit's reasonably foreseeable that
they're going to act or rely onthis advice in some fashion,
you've created an attorneyclient relationship and you're
going to be held to the accuracyof that and there was a loss
(44:12):
paid. So that's just an exampleof That's
Davina (44:16):
huge, that's huge. One of the things that I see happen
a lot, and I don't know ifyou've read any of these groups,
but on Facebook is an example. Alot of lawyer groups on
Facebook, A lot of lawyers goin. I remember mentors, just
older people very strongly,saying to me, we go to a bar and
(44:40):
sit and talk about our client'scase, even if we don't share
names. Cause you never knowwho's listening, you never know.
Mark (44:46):
And
Davina (44:49):
law school, drilled it in our heads. And I see so many
people go on social media ingroups with ten, twelve thousand
lawyers from all over thecountry, all over the world,
they don't know them, andthey're sharing a client's
confidences because they're madabout how somebody talked to
them or what they said, or canyou believe this? And they think
(45:12):
they're talking you know, withcolleagues about it, but they're
sharing it without sharingnames, but they don't know who
else is in that group who couldtake that information. Have you
ever had any claims or issuesaround social media and things
that come arise out of that?
Mark (45:27):
We have. I'm having trouble thinking of one
immediately where somebody wassharing something without names.
Where we have seen claims andlarge losses and loss of license
over it, is telling clients tomake something go away on social
(45:53):
media. Getting really uh-huh.
Davina (45:58):
Uh-huh. That's so interesting because I think
that's very common for a familylaw attorneys to say, go take
this down or personal injuryattorneys say, Take down that
picture of you dancing.
Mark (46:11):
Be very careful folks and make sure, you know, I've seen
lawyers disbarred for that, andwe have paid, our company has
paid in losses some significantdollars for that misstep. You
know, it was done. They werereally trying to hide
(46:32):
information and it, no.
Davina (46:34):
Did not go well. Not
Mark (46:36):
go well. You had asked though about, and if you want a
story about a firm going Wecould talk about different
stories here. I'll tell you thefirst one that comes to mind. A
(46:57):
lawyer was at a firm, and thisis, I don't know, maybe eight to
10 lawyers, and he knew that thefirm's antivirus security
software suite said it wasNorton. Okay?
So he's at the office oneafternoon and a pop up comes up
on the screen that says this isNorton antivirus, Your system is
(47:21):
infected. Please click here toinitiate a scan and that's, you
know, solve the problem. Heimmediately clicks on that and
then gets up and goes down thehall trying to find the IT guy.
Now they have outside IT. Personwasn't there.
(47:41):
Tried to get him on the phoneand, you know, and it took like
half an hour, forty five minutesor something to finally get in
touch with this person. And theperson said, are the computers
still working? And they said,well, oddly enough, no,
everything's down. So you werehit with ransomware, you know,
and they, this was bad,everything, including their
(48:06):
backups, because they kept theirbackups connected to the system.
You know, they were using theexternal drives that just, you
know, USBs and that kind ofthing.
So everything was infected andgone. And they had no idea how
to fix this and repair, and theywere playing around. The
security guy, I should say theIT guys tried to help, okay, but
(48:31):
they are not forensic experts,and they were
Davina (48:35):
trying Not cyber security experts.
Mark (48:36):
They are not cyber security people, and you know,
they are not trained to dealwith ransomware and all. These
are just sort of local guys.Sure they're good people, they
were way in over the head. Thelong story short is the time
period to come up with thecryptocurrency and pay the
ransom, it all expired. Theylost everything.
(48:58):
They could get nothing back. Asa result of this attack, the
firm did dissolve and break upbecause they couldn't afford the
losses and they could, I mean,it just blew up.
Davina (49:12):
The clients affected by this, oh my goodness. I can't
even imagine how.
Mark (49:18):
They lost everything.
Davina (49:19):
Well, how stressful that must have been for everybody
involved.
Mark (49:26):
Hear me clearly again, folks. It was all for just
clicking on a pop up. He thoughthe was doing the right thing.
Okay. What you need tounderstand is security systems
work by them selves.
You don't need to click onanything to do it. Was the same.
Davina (49:44):
Shouldn't be well, one of the things I we're always
getting, spam email. I mean,it's spammed all day long with
all kinds of things. And it'samazing how much something looks
like Capital One now orsomething looks
Mark (49:59):
like Oh yeah.
Davina (49:59):
Something looks like Bank of America. It all looks so
authentic. I've gotten some ofthose Norton ones. I always go
to the email and I look and see.I hover over that and I see what
the email is.
Mark (50:11):
Yep.
Davina (50:12):
That's a little tip. You can just see the email is, you
know, Sally's, you know, houseor whatever, it's got some sort
of weird.net. It's like, no,that's not the company. Also
just leaving the email and goingyourself and logging into
something to see if it's reallysending you an alert or if
(50:34):
that's scam. And most of ourscams, let's just put it that
way.
So that is terrifying. That isterrifying. And that happens
probably way more often than we
Mark (50:44):
think. Oh, does.
Davina (50:46):
Yeah. So what we talked about you have, I was very
surprised when I went on yourwebsite and I was looking, I'm
like, oh my gosh, they've gotlike nine to 12 different
coverages here. And your mainclients are solos and small
firms. So we're not talking bigfirms. So what do we need?
(51:09):
I mean, obviously, I thinkyou've got solo and small firm
owners who are like, well, Ican't afford. I mean, I'm
already paying high healthinsurance and high. Can't afford
everything that you offer. Solike, what are some things that
we really should think aboutthat we might need?
Mark (51:26):
Well, in my mind, you know, we've been talking about
two of the biggest. You know, Iwould not feel comfortable
practicing without a malpracticeinsurance policy, you know, and
you know, maybe your exposure's2 or 3,000,000 and you can't
afford that coverage. Okay, buy,you know, $25,500 or something.
(51:47):
Some coverage is better than nocoverage, you know. And so I
always would agree, you know,just buy what you can afford and
start there.
And then we'll see as thepractice evolves and hopefully
it becomes more and moresuccessful, you can adjust
accordingly. I would also neverpractice without cybersecurity,
cyber liability, I should say,cyber liability It's just
(52:12):
absolutely not. When I firststarted out in this industry,
you know, was all aboutmalpractice. Now, it's more
likely you're gonna be hit witha cyber event. It's not if, it's
when.
And the question is how bad whenthat happens.
Davina (52:26):
That's not true with
Intro (52:28):
my
practice.
Davina (52:27):
Me sick and sick in my stomach, because it's already,
we already are personallyvulnerable, but when you think
about the responsibility for allthese other people, you also,
tell me about business ownersbecause I think this is
something when we're dealingwith solo and small firms often
this, I mean, the solo is theonly lawyer and they're the
(52:48):
business owner and thensomething happens to them. Is
this something that you guysoffer or recommend? Well,
Mark (52:56):
owners, you know, are commercial liability. Know,
that's, we're really talkingabout slip, trip, and fall,
fire, that kind of thing forphysical space. What I heard you
saying, this is more, well, whatif I'm not here and what
happens? I would, you know, Ithink there's value in having a
(53:17):
key person life insurance orsomething like that to protect.
Because if you die at your deskand there's no successor,
there's a mess, and trust me,I've been on the phone with the
spouse, he or she is livid,absolutely livid, and also just
mourning and grieving, and itjust, know, how, why did they
(53:40):
not, I don't know what to dowith all this stuff.
I have built that, you know, andit can be expensive. So, you
know, key man or key personinsurance is a good If you have
physical space, I absolutelythink, you know, an office by
commercial package businessowners, a BOP business owners
policy. If it's, you know, ifit's all virtual, I don't know
(54:04):
that that's absolutelynecessary. That wouldn't be my
top priority, but. Yeah, yeah.
You know, another thing to thinkabout as you grow wealth, make
sure you have an umbrella onyour personal side because, you
know, you have a JD after yourname, you have some money, if
somebody slips on the ice out inyour home in Colorado or trips
(54:26):
on a court or something in heredown in Florida, they're gonna
come after you. And you know,the homeowners is not typically
enough. So put an umbrella of acouple million over, but that's
later on. Malpractice, cyber.
Davina (54:41):
Need to end this conversation because, I'm
learning so much and I thinkthis is such an important topic.
I may be bringing you back formore, but I want to know
particularly, we're gonna put alink in the show notes with
your, information. But I want toknow particularly how people can
(55:01):
find your CLEs or find moreeducation and information.
Mark (55:06):
All of that would be on the corporate website,
www.alpsinsurance.com. A finalthing that I can add, and my
email will be there. Let me justunderscore folks very quickly.
I'm not a traditional riskmanager. I'm not hired to manage
the risk of a corporation.
I'm not a CRO. I'm hired by Alpsto be a risk manager at the bar
(55:27):
at large. There's no fee tovisit with me. You don't need to
be an Alps insurer to visit withme. If there's something I can
do to help you stay out oftrouble or just do a little
education, ethics, insurance,cybersecurity, malpractice
appointments, whatever, feelfree to reach out.
Happy to help any of yourlisteners, Davina. Happy to
Thank
Davina (55:47):
you. Tell them you heard about him on Wealthy Moment
Lawyer. All right, Mark, thanksso much for being here. I've
really enjoyed our conversation.
Mark (55:54):
You're most welcome. Thanks for having me.
Intro (55:57):
If you're ready to create more of what you truly desire in
your business and your life,then you'll want to visit us at
wealthywomanlawyer.com to learnmore about how we help our
clients create wealth generatinglaw firms with ease.
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