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Rarely does overbilling cause a lawyer to lose his license or land him in jail. Meet the exception: former Miami Beach attorney James F. Dougherty II. The Florida Supreme Court last week disbarred Dougherty for five years, the final action on a summary suspension imposed in 1997 after he was convicted of bilking Lloyd’s of London out of $2.5 million. Dougherty can petition for reinstatement in 2002, five years from the original suspension, but first must complete a 6 1/2-year federal prison sentence for wire fraud. He could not be reached for comment. Ironically, Dougherty ran into trouble when he submitted fraudulent bills on a fraud investigation that he conducted for Lloyd’s. The international insurer retained him to unmask a phony $3 million claim by Munther Bilbeisi, a Jordanian businessman who then lived in Boca Raton, Fla. Dougherty’s sleuthing, however, ended up costing Lloyd’s much more than Bilbeisi’s original claim. Court records show that Dougherty claimed he employed a stable of lawyers working 16 or more hours a day as his legal team pursued Bilbeisi. Lloyd’s paid Dougherty $9.1 million between 1987 and 1992 — $4 million in fees and $5.1 million for expenses. But in 1992, a former associate and chief investigator blew the whistle, telling Lloyd’s about questionable invoices submitted by Dougherty. Lloyd’s immediately summoned Dougherty to London and fired him. The insurer then asked the Florida Bar and U.S. attorney’s office to investigate. The government indicted him in 1994 on 10 counts of wire fraud because Lloyd’s paid Dougherty through wire transfers. After a 1997 jury trial in West Palm Beach, U.S. District Judge Daniel T.K. Hurley found that Dougherty overbilled $300,000 for legal work that he did himself plus $1 million in associates’ work. Raising bill-padding to an art, he also inflated expenses by $1.2 million, Hurley ruled. Hurley, who also found that Dougherty lied under oath, sentenced the former attorney to 6 1/2 years, seven months more than the maximum under federal guidelines. After Lloyd’s fired him in 1992, Dougherty invoiced Lloyd’s for $1.3 million more in expenses. Lloyd’s did not pay the bill.

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