TRENTON, N.J. (RNS) Only a few years ago, Edward Fagan was a world-renowned lawyer for the underdog, brash and audacious enough to take on Swiss banks and even whole countries to win judgments for Holocaust survivors and victims of South African apartheid.
Now, the state Supreme Court has barred him from practicing law in New Jersey after finding that Fagan, 56, misappropriated nearly $400,000 of the money he won for the victims he so effectively championed.
The justices agreed with a report that said Fagan knowingly misused client and escrow trust funds, and was also punished for his “conduct involving dishonesty, fraud, deceit, or misrepresentation.” Fagan was disbarred in New York last year.
“Somebody’s life work that goes bad in such a negative way … that’s the sad part,” said Jeannette Bernstein, the niece of Estelle Sapir, a Holocaust victim and former client of Fagan’s who had “entrusted” him with “everything.”
“I think the survivors were badly serviced by him,” Bernstein said. “He worked very hard but along the way, he lost us somewhere.”
In an e-mail, Fagan said he had no comment on the court’s order.
During a recent court hearing, Fagan said he “didn’t misappropriate a penny of client funds.”
Fagan did not deny he had taken more than $800,000 from Gizella Weisshaus, a Holocaust survivor he represented, after putting it in his own personal trust fund. He said he was “entitled” to the money for work he had done on her behalf.
But Fagan could not produce all of the records showing he had done that work. “I was a terrible bookkeeper,” he told the court, saying the New Jersey Office of Attorney Ethics had stolen his documents.
Fagan’s work included representing victims of a fatal fire on an Austrian ski lift and a 2002 legal action against Swiss banks, claiming their financial dealings had helped extend South Africa’s apartheid regime.
He gained international attention by being the first to file suit against Swiss banks for Holocaust survivors. In the class-action case, he and other lawyers eventually got a $1.25 billion settlement for thousands of clients in 1998.
Elan Steinberg, the former executive director of the World Jewish Congress, said when the case began, he was “critical” of lawyers like Fagan, who charged fees for the survivors they represented. Steinberg described the misappropriation of client funds as a “tragedy twice over” for Holocaust victims.
“There’s something also particularly poignant here, in that the effort was trying to achieve justice and this terrible turn of events makes this particularly bitter,” Steinberg said.
