By James S. Simon, Esq.

In this issue of the Advisor we focus on protecting your business and personal assets. In an article on corporate embezzlement, Peter Cahoon of Buckingham Akron^SM and Walter Lucas of Buckingham Cleveland^SM describe steps you can take to prevent embezzlement in your company and how to react if your business is the victim of this kind of crime. George Weinstein of Buckingham Boca Raton^SM writes about how a comprehensive estate plan protects your personal assets both after your death and in case you become incapacitated. Lawrence Friedlander of Buckingham Cleveland^SM offers advice on protecting your personal assets from identity theft. He also outlines the steps to take if your personal information is being used fraudulently.

Please feel free to call the author of an Advisor article, or any Buckingham, Doolittle, & Burroughs, LLP attorney, if you have questions concerning the application of this information to your specific situation.

James Simon is an Associate attorney and member of the Business Law Practice Group.  He can be contacted at jsimon@bdblaw.com or 330.258.6504.

Corporate Embezzlement and How to React to It
By Peter T. Cahoon, Esq. and Walter A. Lucas, Esq.

White-collar criminal defense attorneys occasionally end up representing corporate victims instead of subjects of criminal investigations and criminal defendants.  On a frequent basis, businesses which have been victimized by embezzlement (employee theft) retain counsel to assist in the investigation of these matters. 

In embezzlement cases, usually the criminal is an employee in a fairly high position, who has been delegated a great deal of responsibility, including check-signing authority.  This may be a controller, accountant, president, or chief financial officer.  Occasionally, the thief is a certified public accountant.  Typical motives for embezzlement include the financial strain of an employee who has been living beyond his or her means, and simple greed.  Sometimes it becomes so easy for an employee to embezzle that this can also be a factor.  If an employee has unsupervised check-writing ability, and handles the books, no one might know about the embezzlement until the employee is fired and an audit occurs, or until, for some other reason, the corporate books are reviewed.

There are standard planning tools that a corporation can use to prevent embezzlement.  These include, among other methods, periodic, internal audits; a requirement that two individuals sign all checks; and hands-on management by corporate senior management, in order to avoid the syndrome of “while the cat’s away, the mice will play.”  Counsel can work with management to set up controls against embezzlements.  One common method used to avoid creating an environment where embezzlement could occur is that corporate “perks” should be clearly spelled out in written employment contracts or a written policy statement.  Embezzlers occasionally claim, after being caught, that what they stole was authorized by the company, for example, funds used for the embezzler’s mortgage payment, personal trips, or private school tuition. 

When an embezzlement occurs, there are three basic considerations.  First, law enforcement must be contacted, and it is helpful for counsel to work along with the corporate client in such a case to make sure that the investigation proceeds expeditiously and appropriately.  Second, available insurance must be reviewed.  Sometimes, more than one policy may cover these losses.  Third, if a bank has cashed a corporate check with a forged endorsement and the company has not acted negligently, the bank may be liable for the loss.

The best way to deal with corporate embezzlement is not to let it occur.  With counsel, a business can establish appropriate controls and a system to prevent these losses.  In the event that a loss does occur, counsel can help clients through this process and toward loss recovery. 

Peter Cahoon is a Shareholder and member of the Litigation Practice Group.  He can be contacted at pcahoon@bdblaw.com or 330.258.6534.  Walter Lucas is an Associate attorney and member of the Litigation Practice Group.  He can be contacted at slucas@bdblaw.com or 216.453.4281.


The Full Potential of Estate Planning
By George Weinstein, Esq., CPA

Estate planning can be much more than making decisions to be acted on after your death. Used to its full potential, estate planning also allows you to plan for your future, create contingencies for illness and disability, and provide instructions for your end-of-life care. By consulting with your attorney, accountant, financial planner and other professionals, you can create an estate plan that helps ensure a comfortable life for yourself as well as appropriate distribution of your assets after your death.

Your estate plan should be founded on your personal goals and objectives and your expectations for quality of life. The process of creating an estate plan begins by asking yourself questions that help define your goals and expectations:

• How much will I need to live on in the future?
• How will I meet medical costs?
• Who will take care of me if I become unable to take care of myself?
• Who will manage my assets?
• Who will make medical decisions for me?
• What health-care decisions can I make now to determine my care in the future?  

Once you have considered these and other questions, you can work with your attorney and other advisors to draw up the documents that define your wishes. 

To provide for the management of your assets, you may decide to create a living trust under professional management. This can take effect now or come into play in the event that you become incapacitated. Since a living trust is a legal document, you will need to ask your attorney to draw it up according to your instructions. 

A living will allows you to determine what life-sustaining procedures (such as nutrition and hydration) you will have if you become terminally ill. It also allows you to make provision for donating your organs. For other medical decisions that would be made if you were incapacitated, you can appoint someone to act for you by completing a health care surrogate designation form. 

A durable power of attorney allows you to name someone who will act for you in specific matters that are stated in the document. The term “durable” means that the document remains valid if you are incapacitated. In some states the person you appoint is empowered to act for you whether or not you are incapacitated. In other states, the power is a “springing power” that comes into effect only when you are incapacitated. 

Wills, trusts and beneficiary designations are the most important documents for determining what becomes of your property. They allow you to determine who should inherit (family members, charities or other beneficiaries) and whether the property is to be left outright or in trust. These documents also give you the opportunity to minimize estate taxes and to decide whether property should go to your beneficiaries during your lifetime (inter vivos) or at your death (testamentary). 

While you cannot make life predictable, you can make decisions that anticipate life-changing events and help provide for your continued financial and physical comfort. Even though no one can see into the future with certainty, creating a complete estate plan allows you to take charge of many aspects of your life in the years to come.

George Weinstein is an Of Counsel attorney and member of the Trusts & Estates Practice Group.  He can be contacted at gweinstein@bdblaw.com or 561.995.2981.


Identity Theft
By Lawrence Friedlander, Esq.

In this modern world of electronic wizardry, we must be vigilant about identity theft.  The misuse of your Social Security number can cause great hardship, both in terms of your credit, your retirement, and your day-to-day economics. It is too easy for a criminal to steal your Social Security number.  The obvious way is by stealing wallets, purses, or your mail or by going through your trash, both personal and business, for data, receipts, and account information.  However, in this day of the Internet it is possible for a criminal to steal on line, either from an unsecured business website or personal records on your own computer. 

It is important, therefore, to be constantly vigilant and to carefully check all charge account billings, telephone bills, credit cards, and any unexplained statements which you may get, even if it appears that your name has been misspelled or your address is missing or misspelled.  Also, check your earnings records at work through the payroll department.  Every person who is working and not already receiving Social Security benefits and is over age twenty-five will automatically receive a Social Security statement each year.  These statements list posted earnings to your record; you should check them regularly to make sure they are correct.             

It is also beneficial to invest in a paper shredder and shred all receipts and used credit documents, especially if they contain information valuable to a thief, such as your Social Security number, credit card number, birth date, or bank account numbers.  In addition, keep a photocopy of the front and back of all credit cards, whether they are in constant or only occasional use.  Keep these photocopies in a safe place.  In the event of theft it will make it much easier for you to report a lost, stolen, or misused credit card directly to the company.   

If you are the victim of a theft, immediately take these steps to minimize the damage:   

• Contact the creditor who approved your credit and follow up with a letter. 
• File a police report.
• Contact the fraud department of the credit card providers and ask that a flag be placed on your record requiring creditors to contact you before additional charges are approved using your name. 

Two other numbers to call in the event of identity theft are: 

• The Social Security Fraud Hotline 1.800.269.0271.
• The Federal Trade Commission Theft Hotline:  1.877.438.4338. 

The following are major credit reporting agencies.  Call and let them know if your personal information is used fraudulently.  You can also request a copy of your credit report from these agencies.  Some will charge a nominal fee.   

• Equifax, to report a fraud, 1.800.525.6285; to order a credit report, 1.800.685.1111; website:  www.equifax.com.
• Experian, to report a fraud, 1.888.397.3742; to obtain a credit report 1.888.397.3742; website:  www.experian.com.
• Transunion, to report a fraud 1.800.680.7289; for a credit report 1.800.916.8800; website:  www.tuc.com. 

Check your homeowner’s insurance to determine if you have coverage for credit card theft.  Most homeowner policies provide this coverage, and so do most credit card companies.  

If you run into persistent problems, either with credit reporting or the misuse of your credit or inability to clear your credit once a fraud has been committed, it may be beneficial to contact an attorney to help in this process. 

The best advice is to be vigilant.

Lawrence Friedlander is an Of Counsel attorney and member of the Workers’ Compensation and Litigation Practice Groups.  He can be contacted at lfriedlander@bdblaw.com or 216.615.7358.

Buckingham to Serve as Counsel for Insureds of Chubb Insurance Company

Buckingham, Doolittle & Burroughs is pleased to announce that Chubb Insurance Company has approved Buckingham to serve as counsel for its insureds.  Chubb is especially strong in areas such as directors and officers liability insurance (in profit and nonprofit areas), employment insurance and other niche risks.  If you are currently insured with Chubb, and wish to have a Buckingham attorney represent your Company, your nonprofit or you as an individual, you need only request that your broker include a rider specifying defense work by Buckingham.  Chubb has agreed to honor these requests.  If you have any questions, you can contact Gerald B. Chattman, Managing Partner of Buckingham, Doolittle & Burroughs, LLP, Cleveland. 

Gerald Chattman is a Shareholder and member of the Employment Law Practice Group.  He can be contacted at gchattman@bdblaw.com or216.615.7354.

 
Congratulations to Mark D. Frasure, Esq. of Buckingham Canton^SM, who has been elected to membership in the American Board of Trial Advocates.

Thank you to George Weinstein, Esq., CPA of Buckingham Boca Raton ^SM, from The Jewish Community Foundation of The Jewish Federation of South Palm Beach County for assisting in making their newsletter a tremendous success with his article “Florida Principal and Income Act – Some Considerations.”

Save the Date for these Upcoming Presentations:

On June 9, 2003, John P. Slagter (Buckingham Cleveland^SM) will be speaking at “Boundary Law in Ohio,” sponsored by the National Business Institute.  His topics are Water Boundaries, Ethics, and Handling Right-of-Way Problems.  Please contact the National Business Institute for additional information at www.nbi-sems.com or 800.930.6182. 

Out and About – Recent Presentations:

Health Law Practice Group
Joseph J. Feltes and Shila Nalawadi (Buckingham Canton^SM) presented at the Lorman Education Services sponsored seminar titled “HIPAA Compliance-Understanding and Implementing the Security and Privacy Regulations in Ohio” in Akron, Ohio. 

Intellectual Property Practice Group
David P. Dureska (Buckingham Canton^SM) spoke to a group of upcoming engineers at Kent State University – Tuscarawas Campus on “Intellectual Property for Engineers.” 

Litigation Practice Group
William B. Leahy (Buckingham Cleveland^SM) spoke on “Scott-Ponzer Law” for CPR Institute for Dispute Resolution.  He also gave a presentation for the American Arbitration Association in connection with ADR Day. 

Medical Malpractice Defense Practice Group
Paul A. Dzenitis (Buckingham Cleveland^SM) appeared on Court TV regarding Commonwealth of Kentucky v. Aaron Hardin. 

Rhonda L. Warren (Buckingham Canton^SM) presented at a National Business Institute sponsored seminar titled “Medical Records for Attorneys” in Akron, Ohio.    

Real Estate & Construction Law Practice Group
Robert A. Hager (Buckingham Cleveland^SM), John P. Slagter (Buckingham Cleveland^SM), and David W. Woodburn (Buckingham Akron^SM) were presenters at the Buckingham Annual Real Estate & Construction Law Seminar held in Akron, Ohio.  Their topics were “Fairness in Contracting Act:  ‘Level the Playing Field,’” “Legal Strategies for Real Property Tax,” and “Case Law Update.” 

Robert A. Hager (Buckingham Cleveland^SM) presented “Litigation of Liens” at the Ohio State Bar Association sponsored seminar titled “Real Estate Litigation” in Cleveland, Ohio.   

Donald B. Leach, Jr. (Buckingham Columbus^SM) presented “Liens and Encumbrances Affecting Real Estate”  on behalf of the Ohio State Bar Association Continuing Legal Education Institute in Columbus, Ohio.  He also spoke on “The How’s and Why’s of Paperwork” at the “Ohio’s Mechanics’ Lien Law Seminar” sponsored by The Builders Exchange of Central Ohio.   

Craig B. Paynter (Buckingham Columbus^SM) gave a presentation titled “Litigation of Liens” at the Ohio State Bar Association in Columbus, Ohio. 

Taxation & Employee Benefits Practice Group
Steven A. Dimengo (Buckingham Akron^SM) presented “1031 – Deferring Tax on Real Estate Sales (Like Kind Exchanges)” at Buckingham’s Annual Real Estate & Construction Law Seminar in Akron, Ohio. 

Workers’ Compensation Practice Group
Lawrence Friedlander (Buckingham Cleveland^SM) gave an update on recent decisions and changes regarding Workers’ Compensation Law at a Workers’ Compensation Seminar designed for attorneys, human resource and workers’ compensation benefits coordinators. 

Deborah Sesek (Buckingham Cleveland^SM) was a presenter at the Self Insured Group of Ohio (SIGO) Education Day.  Her topic was “Ethical Considerations for Lawyers in the Workers’ Compensation Practice.”

If you are interested in obtaining information on upcoming seminars or would be interested in having speakers from Buckingham, Doolittle & Burroughs, LLP make a presentation to your organization, please contact: Cheryl Warren, Director of Client Relations and Marketing at cwarren@bdblaw.com or 800.686.2825 ext. 546.


At BDB we are always improving our processes so that we operate efficiently and effectively. Please let us know how you like our new broadcast format. E-mail: bdb@bdblaw.com Phone: 330.258.6473 Fax: 330.252.5473.
Thank you.