Al Parish investors to get checks
Those left in financial ruin by convicted swindler Al Parish received a small scrap of fortune Friday: settlements from the disgraced economist's lawyer and accounting firm.
Mount Pleasant attorney Robert Pearlman, who represented Parish, agreed to pay $1.25 million to an estimated 450 people, a class that includes anyone who lost more than $100 in the $66 million Ponzi scheme. Charleston accounting firm Dixon Hughes, in a separate case, agreed to pay $500,000 to a class of some 540 investors.
Jim Griffin, a Columbia attorney representing the investors, said the cases next head to a "fairness hearing" in October. If they get final approval, investors should receive checks within a month.
"Between the two, it's significant," Griffin said. "But obviously no one from these two settlements will be wholly reimbursed from their losses."
Hundreds of clients suffered a loss in Parish's scheme. In 2008, the Charleston Southern University professor and self-described "Economan" was sentenced to 24 years in prison.
The lawsuit against Pearlman alleged that the attorney "failed to exercise reasonable care, skill, prudence and diligence generally recognized in the legal profession under the same or similar circumstances and was grossly negligent and reckless in his conduct." Those actions included helping Parish write a letter to the S.C. attorney general in 1997 stating that Parish did not receive any commission or fee for his investment pools and did not solicit investors, according to the lawsuit.
"The assertion that Parish was not paid in any way did not conform with what Pearlman knew to be true," the lawsuit said.
Pearlman could not be reached for comment Friday afternoon but previously said that the only work he completed for Parish concerned the wills and trusts of the former economist and his wife.
The lawsuit against Dixon Hughes and three of its employees hinged on a "Comfort Report" that the firm sent to Parish investors in early 2007. It alleged that the firm claimed to compile the report from brokerage statements, when it received statements generated only by Parish that "summarized imaginary account balances."
The lawsuit said Parish continued collecting and mismanaging investment funds after Dixon Hughes released the "Comfort Report." Two clients more than doubled their investments after reading the report, sinking an additional $250,000 in Parish's Ponzi scheme.
Rick Sharpless, a Greensboro, N.C.-based attorney for Dixon Hughes, declined to comment. Dixon Hughes previously issued a statement saying, in part, "Our report made it clear that we did not perform an audit and had we been asked to do so, we might have discovered additional information."
Reach Allyson Bird at 937-5594 or on Twitter at @allysonjbird.
