Disbarred For Insurance Fraud
The Rhode Island Supreme Court has disbarred a convicted attorney
The respondent was a member of the bar of this state. On November 17, 2011 he was charged in a sixty-six count indictment filed in the United States District Court for the District of Rhode Island which alleged that the respondent had engaged in an investment scheme to defraud insurance carriers by securing the identities of terminally ill people by making direct material misrepresentations and omissions of fact to them, and then purchasing variable annuities and corporate bonds with death-benefit features that utilized these ill patients as the measuring life. On November 19, 2012, four days into what was anticipated to be a three-month trial the respondent entered a plea of guilty to one felony count of wire fraud, in violation of 18 U.S.C. § 1343, and one felony count of conspiracy, in violation of 18 U.S.C. § 371. The government dismissed the remaining counts of the indictment.
On February 28, 2013, subsequent to the entry of his guilty plea but prior to the imposition of sentence, the respondent filed a motion to vacate his plea. On August 1, 2013, after a four-day hearing, the District Court denied the motion. On December 16, 2013, the respondent was sentenced to a term of imprisonment of seventy-two months on the charge of wire fraud, and sixty months, to be served concurrently, on the charge of conspiracy. He is presently serving that sentence. Restitution has been ordered in the amount of $46,000,000. The respondent filed an appeal of the denial of his motion to vacate his plea with the United States Court of Appeals for the First Circuit. On January 16, 2014, Disciplinary Counsel filed a petition with this court in accordance with the provisions of Article III, Rule 12 of the Supreme Court Rules of Disciplinary Procedure, requesting that the respondent be suspended from the practice of law pending the outcome of his appeal. The respondent notified this Court through counsel that he had no objection to the petition. Accordingly, on February 20, 2014 this Court entered an order suspending the respondent from the practice of law pending the outcome of his appeal and until further order of the Court.
On December 7, 2015, the United States Court of Appeals issued its opinion affirming the District Court’s denial of the respondent’s motion to vacate his plea. The respondent thereafter filed a petition for writ of certiorari with the Supreme Court of the United States seeking review of the decision of the First Circuit. That petition was denied on May 23, 2016.
The respondent now has exhausted all avenues of appeal, and Disciplinary Counsel’s motion to disbar may therefore be granted.
The New York Times reported on the crimes
Joseph Caramadre contends he was a philanthropist and a clever lawyer, offering $2,000 payments to people who were dying. The United States attorney contends that he was a scam artist, preying on the very ill and getting rich by defrauding insurance companies.
In the face of overwhelming evidence, Mr. Caramadre pleaded guilty last year, and on Monday, a federal judge here sent him to prison for six years.
Mr. Caramadre, an estate planner and a prominent member of the state’s Roman Catholic establishment, said he was merely exploiting a gap in insurance companies’ writing of the rules governing their products, and doing nothing illegal. Instead, he said, he was giving thousands of dollars to struggling families. His largess is well known; the court received dozens of letters praising Mr. Caramadre, including one from the bishop of Providence and one from a former Boston mayor…
During the hearing, Mr. Caramadre apologized to the families of the terminally ill patients for the distress his actions caused, but stopped short of admitting he had actually cheated any of them.
“I cannot tell you I am sorry that these terminally ill people got defrauded,” said Mr. Caramadre, who explained he would be lying if he did so. “I just wanted to share wealth.”
(Mike Frisch)