Full story in Arizona Central

By Laura Gersony

• An Arizona Supreme Court program allowing nonlawyers to own law firms has led to numerous consumer complaints.
• Several members of the program’s oversight committee also have financial ties to firms they help oversee.
• The program, intended to make legal services cheaper, has been criticized for attracting profit-focused investors.

An Arizona Supreme Court experiment to make legal services cheaper for the state’s residents has instead become an epicenter for consumer complaints, leaving a trail of clients across the United States who say they were mistreated, misled, or — in the words of a lawsuit against one firm — outright “scammed.”

Loopholes, a lack of oversight and financial conflicts of interest plague the state’s “Alternative Business Structures” program, which allows Wall Street investors, marketing professionals and other nonlawyers to own law firms.

Companies use the program to operate in all 50 states. Investors — not lawyers — have transformed law firms into call centers, raking in cases that they farm back out to “partners” across the country.

State regulators have done little as more than a dozen operators have been accused in court of hurting their customers or breaking consumer protection rules, with allegations ranging from illegal robo-calling to what Alabama prosecutors call a deceptive scheme that “commoditized” car accident victims in one of the poorest states in the country.

Another three firms have amassed a steady stream of customers who have complained, in interviews with The Arizona Republic and other noncourt venues, that the firms mishandled cases, misled customers to sell products, or extracted excessive fees from clients who didn’t know any better.

The court had approved more than 150 applications for the program as of Jan. 1. It had rejected only three.

Despite these issues, just two firms have received mild discipline. One firm may soon be kicked out of the program, though the decision is not yet final.

A committee of appointed volunteers from the legal community closely advises the Supreme Court justices on each licensing decision.

Several of those committee members also make money counseling the firms applying for the program. An ethics expert told The Republic they should step down.

The new program, which never came before voters or the Arizona Legislature, was divisive among lawyers. Critics warned it would lower the quality of legal services, attracting profit-hungry businesspeople who see those in need of legal help not as clients but as numbers in a financial portfolio.

Court officials knew about those concerns. So they designed a program they said would screen applicants carefully and keep “bad actors” out.

On both counts, they have failed, The Arizona Republic’s investigation found.

Almost 10% of licensees have been accused of misleading, defrauding or repeatedly taking advantage of consumers either before or after they received a license.

Several licensees are accused of targeting vulnerable people, such as those in financial distress. Immigration firms in particular have become a flashpoint for consumer complaints.

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Following months of outreach from The Republic, the court and committee have signaled they will revisit the program’s rules, but the deliberations were still taking shape as of early 2026.

Other states have considered and then rejected the Arizona-style change. Utah, the only state with a comparable licensing program, clawed back nearly three-quarters of the licenses it had issued after a review found the program had gone awry.

Since 2022, Arizona’s program has grown tenfold.

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In almost every U.S. state, people who aren’t lawyers can’t own a law firm. Through Arizona’s “Alternative Business Structures” program, you can.

In 2022, the head of the firm, lawyer Michael Niren, received a license to open an Arizona-based subsidiary of VisaPlace. Appearing before the committee in 2024, Niren thanked regulators, saying the license was giving him new business opportunities.

Were it not for the Arizona license, he said, “the realistic possibility of taking on investors would not be possible.”

Reached for comment, Niren said his Toronto firm amassed a large backlog of client casework during the pandemic. Complaints in a “high-volume” practice like the Canadian law office are inevitable, he said. He said he was unable to comment on specific cases without a waiver, citing his ethical duty to uphold attorney-client privilege, but broadly called the allegations of poor service “false.”

In 2024, when another one of his unhappy clients was profiled in the Toronto Sun, he maintained his firm had tried to keep in touch with the customer, and attributed the lengthy delay to the Canadian government’s backlog processing public records requests.

Niren emphasized that VisaPlace was honored 10 years in a row by “Top Choice Awards,” a company whose bare-bones website indicates that firms can pay to “promote and enhance their winning status.” (At least two other businesspeople granted an Arizona license promote an award they’ve received through the same company.)

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VisaPlace is one of at least three immigration firms given an Arizona license whose backers are trailed by angry customers.

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Utah, which has a much smaller, more tightly regulated version of the Arizona program, has stopped giving licenses to for-profit immigration firms. Regulators there came to the conclusion that they “offer little potential for consumer-friendly innovations and pose an outsized risk of consumer harm.”

Arizona has made no such reform: The immigration firms remain in good standing with the court.

Accusations of targeting consumers in financial distress

Other Arizona-approved licensees have been accused of targeting consumers in financial distress.

Two firms — the New Jersey-based Alperstein & Associates, and Ohio-based Consumer Defense Partners — have settled lawsuits accusing them of a “bait and switch” marketing tactic.

The lawsuits, filed in 2024 and 2025, alleged that mailed advertisements gave consumers the impression they might qualify for a loan, and that salespeople claimed they would check callers’ eligibility for the loan in a phone call, knowing they would be denied.

The purpose of the exercise was to gin up clients for the firms’ debt resettlement businesses, the lawsuits claim, an illegal use of consumer data to promote a business model the federal Consumer Financial Protection Bureau has warned Americans “can be risky.”

The businesspeople behind both firms received Arizona licenses in 2024.

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Another law office, Scout Law Group, teamed up with an investment firm, 777 Partners, to receive a license in 2022.

Businesses owned by 777 Partners had a history of convincing vulnerable people to turn over large settlements in exchange for immediate — and much smaller — cash payouts, according to a 2023 investigation by the Washington Post.

One lawsuit, filed in 2020, said the companies had cut an exploitative deal with a woman with brain damage and an addiction to narcotics. It was dismissed for lack of standing.

Meanwhile, the firm battled white-collar allegations. 777 Partners unsuccessfully tried to dismiss a 2024 lawsuit that accused the firm of operating “a giant shell game at best, and an outright Ponzi scheme at worst.”  The case is ongoing.

Since then, the co-founder of the firm was indicted in New York in a $500 million fraud scheme. He has pled not guilty.

The accusations of wrongdoing focused on 777, not Scout Law Group. Still they troubled regulators. Scout Law’s license came up for discussion in at least five meetings across 2023 and 2024, after the allegations gained traction in the media. For months, Arizona regulators deferred the conversation to another day, and eventually renewed the license.

Finally, in September 2025, regulators moved to revoke the license, when the firm struggled to find new ownership. If that decision is approved by the court, it will mark the first time a license given through the program is taken back.

Steve German, the Arizona lawyer who founded and led Scout Law for 777 Partners, was so alarmed by the experience that he has turned from an avid supporter of the licensing program into one of its more prominent critics.

He is suing the financiers over money he says they promised but didn’t deliver. It’s yet another accusation of unpaid debts that 777 has tried, unsuccessfully, to dismiss.

And German, who also sits on the court committee overseeing the program, feels the firm wasn’t upfront with either him or the Arizona Supreme Court during the licensing process. He learned about the allegations against 777 through media reports, he told The Republic.

“They were cheating vulnerable people,” German said. “It’s just sickening.”

In 2023, about a year and a half after Scout Law received a license, German sent a long email to the court’s staff outlining his concerns with 777. He copied then-Chief Justice Scott Bales, who directed staff to forward the email to the State Bar, which handles complaints against Arizona firms.

“And nobody did anything,” German said.

During the committee’s monthly meetings, German stands out for asking skeptical questions about companies’ fitness for a license, and for voting “no” on applications. 

Often his “no” vote stands alone.

777 Partners and its cofounder, Josh Wander, did not return multiple requests for comment.

Prosecutors probe Arizona firm’s connection to Alabama ‘scam’

In 2024, as the Arizona licensing program continued to balloon, Williem Vacek, a 27-year-old fresh out of George Mason University’s Antonin Scalia Law School, was eager to participate.

That November he pitched the court on Sterling Shield Legal, a personal injury law firm that would offer low-cost legal services.

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Less than a year later, an Alabama newspaper, the Lagniappe Daily, published an investigation about a Mobile-based injury clinic that was advertising “free” medical treatment for accident victims, pressuring them into expensive, one-size-fits-all treatment plans, and pushing their clientele to retain a lawyer with an out-of-state firm.

Local attorneys began hearing from clients in distress who had signed legal services agreements but never received the money they were owed, Mobile-based attorney David Allen told The Republic.

A fee agreement from one of the aggrieved clients, obtained by The Republic, bears the name on its masthead: Sterling Shield Legal.

A lawsuit from the Mobile County District Attorney followed in July 2025. The Alabama clinic and a D.C.-based firm Vacek Law Group, another company founded by the young lawyer, are named as defendants. Prosecutors have requested information about the clinic’s relationship with Vacek and his Arizona firm, Sterling Shield Legal.

The defendants built a “deceptive scheme” that “commoditized” accident victims, prosecutors wrote in a legal filing, charging victims as much as $800 per hour for treatment.

Victims, prosecutors wrote, were “scammed.”

“Unbeknownst to the accident victims, the treatment was designed — not for their own health and well-being — but to maximize the settlement value of their accident in pre-suit settlement negotiations,” the lawsuit reads.

But 1,500 miles to the west, as Alabama prosecutors scrutinized Vacek and Sterling Shield, the case went unmentioned for months by the Arizona committee that had given them a license.

That is standard protocol: The court does not proactively monitor firms’ behavior, Timmer confirmed, except for when their licenses come up for renewal every two years. 

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Sterling Shield Legal has since withdrawn its Alabama registration and is now registered only in Arizona.

The reference to the firm in the Alabama fee agreement, Dawson told The Republic, “was an error.”

Asked why the firm initially registered in Alabama if it had no business there, he said that, too, was an “error.”

The firm has not faced discipline in Arizona.

When firms misbehave, punishment is light and takes years

To prevent abuses within the program, the licensed firms are subject to Arizona’s usual system for lawyer discipline, a process that can be byzantine.

First, the State Bar receives and investigates charges against lawyers. Next it prosecutes the cases before disciplinary authorities within the Arizona Supreme Court, who hand down an order. The nonlawyer-owned firms are subject to some additional safeguards: For example, the firms themselves can face discipline, not just the individual lawyers that staff them.

But it has rarely gotten to that point.

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Arizona regulators failed to prevent harm in the case of another court-approved firm, Esquire Law.

A State Bar investigation found that Esquire was unresponsive for weeks as clients whose family member had died in a car accident and State Farm insurance, which was attempting to wire settlement money, unsuccessfully tried to reach the firm. (The firm denied the allegation and maintained it was trying to reach the client all along.)

It was not until the investigation that the State Bar found Esquire’s court-mandated compliance lawyer knew very little about the operations that he had been tasked, for three years, with diligently overseeing.

Instead, a nonlawyer was doing much of the work of running the firm, “and frequently directed the cases,” former employees told investigators.

This firm, too, paid only $1,200, to recoup the State Bar’s administrative expenses. 

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Committee accepts 150 applications, rejects only 3

Most of the time the process is not particularly suspenseful. In the first five years of the program, regulators only denied three applications. 

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The committee unanimously voted “no” on the basis of “candor” during the application process and the supervising lawyer’s inexperience.

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They approved one application with just two and a half minutes of discussion.

Regulators have ties to firms they help oversee

Even as members of the committee help decide who does and doesn’t get licensed, several have close ties to the firms that they oversee.

Those committee members abstain from voting on firms they do business with, but they shape guidelines under which all firms are vetted and regulated — for example, helping to write the application paperwork their clients must fill out to obtain or keep their licenses.

Three members of the committee — Lynda Shely, Andy Kvesic, and Taylor Bell — earn money counseling companies interested in obtaining an Arizona license.

The consulting frequently conflicts with Shely’s voting responsibilities: She recused herself from about one-third of the votes taken by the committee during the first nine months of 2025, according to an Arizona Republic review.

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As other states hesitate, Arizona has charged ahead

In theory, nonlawyer-owned firms are supposed to operate in the same manner as ordinary law firms, with individual lawyers having complete control over each case.

In practice, many have gravitated toward quick-profit business models.

Some of the Arizona-licensed firms serve more as case brokers rather than law firms themselves, raking in clients from throughout the United States and farming them back out to “partners” across the country. It’s a lucrative strategy that gives the Arizona firms a cut of the profits even as they do little actual legal work.

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Utah, home to the more tightly-regulated version of Arizona’s program, began revoking companies’ licenses after it found that many firms were operating out of state. Some firms had “misused” their licenses “to bolster their credibility or gain access to restricted advertising markets,” regulators found.

Peter Swann, a former Arizona Court of Appeals judge, was quoted as the lone dissenting voice in an Arizona Supreme Court report pitching the idea in 2019. “There is simply no likelihood that nonlawyers will enhance the quality of justice in Arizona,” he argued at the time.

“Bad legal advice,” Swann wrote, “is never a bargain.”