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The State Bar has seized the files of two Los Angeles-area plaintiffs firms accused of running car accident scams that investigators say bilked insurance companies out of at least $500,000. Early Tuesday, the Bar asked Los Angeles County Superior Court to take over the practices of Dennis Patrick Wilson and John Joseph Nese. Those lawyers keep different offices in Glendale, but represented parties who claimed to be involved in accidents with each other. Bar investigators will use the seized files to contact the attorneys’ legitimate clients and tell them about the ongoing fraud investigation, said William Cox, senior deputy trial counsel with the Bar. “The purpose of the order is to protect clients,” Cox said. The files will go back to clients so they can get new lawyers if they want, he added. The Bar is working with several agencies, including the L.A. district attorney’s office and the state Department of Insurance. The Department of Insurance used undercover investigators to break up the alleged fraud network, which has been under scrutiny for at least a year. Thirteen people were arrested Tuesday on charges including fraud and unlawful referral to a law office, although neither Wilson nor Nese was taken into custody or charged. One man affiliated with Nese’s office, Razmik Nazarian, was also charged with practicing law without a license. According to state records, Nazarian founded the Glendale Legal Center, which is also under investigation. Nazarian could not be reached for comment. The DA’s office would not say whether it intended to file charges against Wilson and Nese. Cox said the Bar would pursue disbarment if either attorney was convicted of felony insurance fraud. Wilson also has offices in Fresno and Sacramento, but neither of those offices was targeted by the Bar. He did not return messages seeking comment. Nese also could not be reached Wednesday. His office phone was forwarded to a Bar hotline. Cox described a “classic” fraud scam. A group of “cappers” — the term for people who create litigation and bring it to attorneys — would stage the accidents, even going so far as to sprinkle broken glass at intersections. The cars were actually damaged at a different location, Cox said. People in one car would be represented by Wilson’s office, the others by Nese’s. Each office would send demand letters to insurance companies asking for reimbursement for nonexistent chiropractor visits, attorneys fees and trebled damages for pain and suffering. The participants, including the chiropractors, would then divide up the proceeds. Tuesday’s bust included 18 search warrants at law offices, clinics and residences. The scammers would also be sure to “stuff” the cars, Cox said. For example, a rear-end collision would have four to five people in the front car and one passenger in the rear car — all would go after the driver’s insurance company, he said. Cox was careful to separate the activities of the law offices from Wilson and Nese themselves, although investigators believe the attorneys received a cut of the illegal proceeds. “Typically in these cases, the office is operated by non-attorneys and the attorneys are essentially employees,” Cox said. “From the physical layout [of the offices] and the location of financial records, such would appear to be the case [here].” The seizure order is due back in L.A. court April 2, when a judge is scheduled to decide whether to make it permanent, Cox said.

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