Overview

Attorney Joseph Lynn DeClue was found culpable of illegally collecting advance fees for loan modification services in violation of Civil Code §2944.7 and Business & Professions Code §6106.3. The Review Department affirmed that DeClue’s misconduct was aggravated by prior discipline, significant client harm, failure to make restitution, and uncharged misconduct, including failure to supervise his staff and aiding in unauthorized practice of law. The court imposed a six-month actual suspension and two years’ probation to protect the public and maintain confidence in the legal profession.

Background

• DeClue was admitted to the California Bar in 1993.
• In 2012, he founded Millenia Law Group and hired One World Alliance (OWA)—managed by non-attorneys Robert Campoy and Andres Martinez—to oversee operations.
• DeClue had prior knowledge that Campoy and Martinez were previously involved in attorney disciplinary cases (e.g., In the Matter of Huang, 2014), yet he gave them significant control over his law firm.

Client Matters

1. The Ornelas Matter

Millenia took over roughly 200 loan modification cases from another firm, including Juan and Teresa Ornelas. The Ornelases paid $2,000 for loan modification services under a prior representation agreement. DeClue admitted receiving these payments but provided no meaningful services. He refunded only $500 on the eve of trial. The Review Department found him culpable for collecting illegal advance fees under §6106.3.

2. The Andinyan Matter

Client Sarkis Andinyan paid DeClue $13,000 for purported foreclosure defense and loan modification services under two separate fee agreements. The court found that the “litigation services” were merely pretextual and that the purpose of both agreements was loan modification. DeClue collected all fees before performing any services, violating §2944.7. He never refunded the money.

Violations

• Business & Professions Code §6106.3: Engaging in conduct violating Civil Code §2944.7 by charging advance fees for loan modification work.
• Rules of Professional Conduct 3-110(A): Failure to perform competently and supervise non-attorney staff.
• Rule 1-300(A): Aiding and abetting unauthorized practice of law.

Aggravating Factors

• Prior Discipline: Two-year stayed suspension in DeClue I (2014) for similar misconduct under §2944.7 and failure to supervise staff.
• Client Harm: Deprived financially distressed clients of funds and failed to deliver promised loan modifications.
• Failure to Make Restitution: Refused to repay clients despite admitting receipt of funds.
• Uncharged Misconduct: Delegated legal responsibilities to non-attorney staff and allowed unauthorized practice.

Mitigation

No mitigating factors were found. Character evidence was limited, and DeClue failed to show remorse or rehabilitation.

Court’s Analysis

• The Review Department emphasized that loan modification fees cannot be collected before services are fully performed.
• As managing attorney, DeClue had a non-delegable duty to supervise all client matters.
• DeClue’s claim that his employees acted independently was rejected; he bore full responsibility for their actions.
• Given his prior discipline and continued misconduct, Standard 1.8(a) required a greater sanction than before.

Disposition

• Six-month actual suspension and two years’ probation.
• Restitution: $1,500 to Juan and Teresa Ornelas and $10,000 to Sarkis Andinyan, plus 10% annual interest.
• Rule 9.20 compliance: Required notice to clients, courts, and opposing counsel.
• Costs: Assessed under §6086.10 as a money judgment.

Sanctions Table

Key Takeaways

• Attorneys may not collect advance fees for loan modifications until services are fully performed.
• Delegating client work to non-attorneys without supervision constitutes failure of competence and aiding UPL.
• Repeated violations after prior discipline result in escalating sanctions under Standard 1.8(a).
• Failure to refund unearned fees and lack of restitution are major aggravating factors.