Scammer to Slammer

Bankruptcy adviser who bilked clients sentenced to federal prison

Disbarred attorney and ex-con Dick Berry stood before federal judge Robert Broomfield on Monday afternoon, trying to talk his way out of jail.

Berry's excuses were the same as they've been for more than two years, after Bankruptcy Court officials started coming down on him and his Tempe-based business, People's Paralegal:

--He'd meant well and, in fact, had done well by his financially beleaguered customers.

--A group of bankruptcy attorneys had been out to get him because he'd been "stealing" their business by providing less-expensive, high-quality service.

--If he'd violated any laws or court orders, he hadn't done so intentionally.

But Broomfield didn't buy Berry's patter.
He sentenced the 56-year-old Tempe man to the maximum sentence of six months in a federal facility. Berry was ordered to report to prison May 27.

The sentencing was the latest turn of events in the slick-talking Berry's protracted legal saga.

On February 3, Broomfield held Berry in criminal contempt, following civil contempt convictions in August 1997 and March 1998.

In the 1997 case, Judge George Nielsen Jr. fined Berry $100,000 for overcharging bankruptcy "clients," and ordered him to repay $172,000.

In the 1998 case, Judge Redfield Baum fined Berry $1 million (and tacked on an additional $2 million in fines against two of Berry's businesses) after Berry continued to prepare bankruptcy petitions in violation of the judge's order.

Assistant U.S. attorney Steve Winerip noted in a sentencing memorandum that Berry had made just one $900 payment--a few weeks ago--on the mammoth fines against him.

On March 24, Berry settled the 1997 case. Originally fined $272,000, the new deal calls for him to pay the government $45,000 at the rate of $850 a month. The settlement allows the government to take his home if he fails to satisfy the judgment.

But the recent settlement didn't allow Berry to evade punishment in the criminal contempt case.

During Monday's hearing, prosecutor Winerip asked Broomfield to send Berry to prison for six months. Representing himself, Berry countered that his woes had been caused by "an ongoing vendetta by the bankruptcy lawyers involved."

He claimed "there never was a consumer who complained about what we did. . . . This was not consumer fraud."

That statement flew in the face of evidence amassed for a New Times article on Berry ("Going for Broke," July 17, 1997).

Based in part on the chilling accounts of numerous local debtors, the story told of Berry and his business, People's Paralegal, which took the Valley's bankruptcy market by storm in 1996. The firm lured 2,000 area residents in a relentless television and print advertising blitz that promised cheap, quality service without attorneys.

Dozens of debtors unnecessarily lost their homes and cars, or found their bankruptcy cases in tatters after taking People's Paralegal's illegal, ill-advised and expensive advice. Federal bankruptcy judges had been slow to grasp the extent of the crisis, and were even slower enacting remedies.

The U.S. Attorney's Office attached the New Times story to its sentencing memorandum. Berry asked Judge Broomfield to disregard the story, contending it was inaccurate.

"It has come to my attention on good authority that the author of that article was under the influence of marijuana when he wrote it," Berry said. Broomfield said he couldn't read the almost-illegible copy of the story anyway.

Winerip told the judge that "Mr. Berry is taking absolutely no responsibility for his conduct. That's the essence of contempt, and the essence of what he's charged with."

Winerip's comments sounded very similar to those made by a parole officer in 1985. The officer issued his report as Berry was about to be released from the Arizona Department of Corrections after serving four years for white-collar fraud--more specifically, according to court records, by "victimizing clients by various acts of dishonesty and deception."

The parole officer referred to Berry as "very slick, sophisticated, and substantially more dangerous to the public than most offenders. . . . Berry is a classic white-collar criminal who shows no remorse, does not accept responsibility for his actions, is deceitful and manipulative."

A personable guy who has lived in the Valley since the 1960s, Berry in his adult life has been a lawyer, a convict, a finance manager, an independent paralegal, a landlord and the owner of several businesses. He lost close races for the Arizona Senate in 1970 and 1972.

Berry told Broomfield during the hearing that he's still doing paralegal work, "but I'm out of the bankruptcy business."

Contact Paul Rubin at his online address: prubin@newtimes.com

 
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