|  | | 2008 News and Press Releases | | |
HEADLINE NEWS:
Art Theft Undid Class-Action Mogul Lerach, Underwriters Told
Susanne Sclafane
National Underwriter Property & Casualty
. November 11, 2008
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EXCERPT: If not for a case of art insurance fraud, a kickback scheme involving attorney William Lerach, who masterminded massive class-action cases, might never have come to light, according to a former assistant U.S. attorney. Robert McGahan, lead prosecutor in the case United States v. William S. Lerach, speaking to an underwriters group recently, described how the discovery of two famous paintings in a Cleveland storage locker and a complex series of events ultimately led to Mr. Lerach's imprisonment for paying illegal kickbacks to people who agreed to become plaintiffs in securities class actions. Mr. McGahan's comments came during a video titled "The Rise and Fall of William Lerach," which was shown during the opening session of the Professional Liability Underwriting Society international conference in San Francisco last week. The group has an interest in securities class actions because of the directors and officers liability claims that result. Mr. McGahan explained that the paintings involved in the art theft fraud were once owned by Steven Cooperman, a retired eye surgeon. Mr. Cooperman was also one of the people paid off by Mr. Lerach's firm to serve as a plaintiff in securities class actions. Mr. McGahan related how Mr. Cooperman staged a phony burglary of the paintings--Picasso's "Nude Before A Mirror" and Monet's "Customs Officer's Cabin At Pourville"--to collect insurance proceeds at a time when he needed funds to pay off some debts. […] According to Mr. McGahan, Mr. Cooperman's partner in art crime was an attorney friend named James Tierney (not involved with Milberg Weiss), who agreed to take the "grossly overinsured" paintings from Mr. Cooperman's house in 1992 when the doctor was away. The insurance companies, suspecting fraud, actually refused to pay, but Mr. Cooperman sued them and ultimately settled with the insurers for $17 million. |
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