Noted Orange County criminal defense lawyer Joseph Gerard Cavallo was sentenced on December 14, 2007 to six months in jail.
According to a press release from the Orange County District Attorney’s Office, between June 1, 2003 and August 1, 2005, Cavallo conspired to commit the crime of attorney “capping” and attorney recommendation by a bail licensee. Co-owners of Xtreme Bail Bonds acted as “runners and cappers” for Cavallo and solicited business for attorney Cavallo at Orange County jail facilities. The Co-owners also illegally recommended their bail bond clients to hire Cavallo as their attorney. It was alleged that the Co-owners received money from Cavallo for performing these acts. In August of 2004, Cavallo transferred $50,000 to one of the Co-owners and claimed it was an “interest free loan.”
The bondsman kept a stack of Cavallo’s business cards at the Xtreme Bail Bond’s office. The bondsmen’s employees had a sheet of “to dos,” and referring clients to Cavallo was part of their written instructions. The employees were told that they would get a bonus for referring bail clients to Cavallo. They were told to tell bail clients that they would get a discount from Cavallo because they were referred for legal services by Xtreme Bail Bond.
The Co-owners recommended their bail clients hire Cavallo. They told their bail clients that defendant Cavallo was a friend of Xtreme Bail Bonds, and would give them a reduced attorney retainer fee. They would then make appointments for the bail client to visit Cavallo. In some cases, they would drive their cars to defendant Cavallo’s law office after directing bail clients to follow them. They would quote Cavallo’s retainer price to bail clients. They instructed bail clients to tell defendant Cavallo that they were referred to Cavallo by Xtreme Bail Bond.
California law prohibits bail bonds workers from recommending any attorney to any bail bond client, even if no money changes hands. Specifically, Insurance Code section 1814 provides that a violation of “any rule of the [insurance] commissioner … is a public offense, punishable by fine not exceeding ten thousand dollars ($10,000), or by imprisonment in the state prison [for 16 months, 2 years, or 3 years], or in the county jail not exceeding one year, or by both such fine and imprisonment.” The insurance commissioner has enacted a rule that provides “[n]o bail licensee shall in any manner, directly or indirectly, suggest the name of or recommend any attorney to any arrestee or person purporting to act for or represent an arrestee.” (Cal. Admin. Code, Tit. 10, § 2071.)
The law also prohibits attorneys from paying non-lawyers for client referrals, which is referred to in the law as “running” or “capping.” (Bus. & Prof. Code, § 6152, subd. (a).)