Milberg Weiss ex-partner David Bershad agreed to plead guilty to charges related to a scheme to pay illegal kickbacks to plaintiffs in securities lawsuits, federal prosecutors said.
Bershad, 67, will plead guilty to one count of conspiracy, the U.S. attorney’s office in Los Angeles said today. He’ll forfeit $7.75 million, pay a $250,000 fine and cooperate with the investigation, according to the plea deal. The conspiracy charge carries a maximum sentence of five years in prison.
For more than seven years, prosecutors have been probing whether Milberg Weiss, which has recovered more than $45 billion for investors in securities-fraud litigation, paid kickbacks to clients in exchange for them signing on to lawsuits. Bershad’s agreement may bring the government closer to charging other lawyers from the firm led by securities litigator Melvyn Weiss.
“This will shake up the investigation,” said Laurie Levenson, a professor at Loyola Law School in Los Angeles and a former federal prosecutor. Bershad “certainly is an insider and he may be exactly what the prosecution needs.”