Update March 24, 2017 – Veritas Legal Plan responds to allegations. Click here.
I recently received some concerns from a reader regarding Peak Legal Advocates. The reader said:
“Thought you might find the attached agreement interesting. Peak Legal Advocates – (PLA) is charging consumers 12% of their debt for a prepaid legal plan that is not licensed or registered in any of the states they operate in. This fee is above what the settlement companies are charging for their services.”
So I went to Peak Legal Advocates for an answer to the allegation. Let’s hear what a Rob Katz, the attorney behind Peak Legal Plan said in response to the allegation.
I have forwarded Rob the attorney-client retainer agreement I received and have asked him to authenticate it or forward a current agreement.
“Dear Mr. Rhode,
I understand you have been in contact with Alex Turner in regard to Peak Legal. As the managing attorney for Peak Legal (“Peak”), he has asked me to respond to your inquiry.
First, thank you for allowing us the opportunity to respond. We are aware that Mr. Angelo Anzalone from Veritas, who is ostensibly a competitor of ours, has been attempting to slander us on-line (Libel) in an effort to eliminate, or at least reduce, any competition that Peak offers for his company. We have explained the true nature of our services to Mr. Anzalone, specifically that neither Peak nor any of the attorneys in our network provide any type of pre-paid legal services. Despite this, Mr. Anzalone has persisted in his efforts, and now appears to be attempting to use your publication in his misguided efforts against Peak.
Despite this, we are happy to be given the opportunity to explain the true nature of our services so that you have full and complete information. First of all, by way of background, Peak Legal Advocates is a dba of The Law Offices of Robert B. Katz & Associates, a California licensed law firm. Please note that I am licensed, and have offices in, California, Arizona, Nevada, and Washington. However, Peak only contracts directly with clients that are located in California. Peak also has a network of related attorneys in several other states, and in the event that a potential client is located in one of those other states, then the client contracts directly with that local state attorney. As such, every contract is executed between the client and a local state attorney who is licensed in that client’s home state, and who provides direct legal services. These facts alone debunk any assertion that Peak is somehow offering a “prepaid legal plan that is not licensed or registered in any of the states they operate in.”
Instead, Peak ONLY contracts with California clients for the provision of direct legal services. Moreover, in other available states (outside of California) local state attorneys that are licensed in those states contract with those clients, also for the provision of direct legal services. In either case, those legal services are limited to defense against creditor harassment and unfair creditor collection practices and the preparation of Pro Se Answers. Neither Peak nor any of its network of attorneys provide any type of additional litigation services without entering in to a separate litigation retainer agreement directly with the client. As such, there are no pre-paid litigation services (or otherwise) being offered by Peak or its network attorneys.
When we explained this fact to Mr. Anzalone he then expressed concerns about the “additional services” that are provided by Legal Club (as specified in Exhibit B of our contract). In response, we further explained we had thoroughly vetted these services with two of our compliance attorneys (we engage two of the best compliance attorneys in the industry to ensure that we are always fully compliant). We also relayed Mr. Anzalone’s concerns to the representative from Legal Club itself. There is universal agreement from each of these experts that the Legal Club services are not a pre-paid legal insurance plan. For your additional reference, I have included the response from Legal Club to the insurance inquiry:
Legal Club is not a legal insurance plan. Legal Club is a legal referral plan that provides members with access to its nationwide network of attorneys who have agreed to provide them with free and discounted services. Legal Club does not pay any fees to its attorneys. Network attorneys do not pay Legal Club for any fees they collect for legal services rendered. Legal Club contracts with attorneys to provide them with potential clients at no expense and in return, the attorneys agree to provide the free and discounted rates that the plan provides. The reason that Legal Club is able to offer members with access to attorneys covering all areas of law without waiting periods or any pre-excluding conditions is because we are not an insurance plan. We do not have any actuarial restrictions to follow. Legal Club is strictly a membership organization, deriving its revenue solely from membership fees.
Prepaid Legal Plans are in fact legal insurance plans. When someone joins a legal insurance plan, the plan provider collects premium from their members and pays their attorneys for legal services performed. Legal Insurance plans follow actuarial models and have waiting periods and pre-excluding condition requirements.
Since Legal Club is not an insured legal plan, we are not regulated by any of the states DOI.
It appears that the primary distinction here is that Legal Club does not pay the plan attorneys for their services. As such, it is simply not insurance.
As a side note, we have also been investigating the practices of Veritas and we have uncovered some elements of their services that you may find interesting. Veritas is not a law firm and is not owned by licensed attorneys. As such, Veritas positions itself as a pre-paid legal insurance provider, and nothing more. However, as we have looked at the services of Veritas we have seen that, in fact, Veritas is acting in a much more involved capacity with its clients. Pre-paid legal plans collect premiums, then paid out legal fees to attorneys when a claim is filed – nothing more. But Veritas goes quite a bit further by actually stepping in to the provision of the legal service itself by taking actions such as, among many others: collecting the Summons and Complaints from clients, assigning the case attorney from their own roster (without giving any choice to the client), collecting other needed documents from the client for the attorney, preparation of documents for the attorneys, providing case scheduling services, providing customer service infrastructure for the attorneys, acting as a liaison between the clients and the attorneys, providing document transmission services, and acting as a liaison between the client and the debt settlement company. In effect, Veritas is acting like a nationwide law firm by providing a full array of case administration services to the client; however, Veritas does not have the licensing to act a law firm in any state. Perhaps this is worthy of further investigation by your publication given that Veritas is clearly acting well outside the bounds a simple pre-paid legal plan.
We hope the above helps clarify that neither Peak nor its network of attorneys are providing any type of pre-paid insurance services. Please let me know if this e-mail has alleviated your concerns.
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