Iowa defense attorney allegedly defrauds Iowan taxpayers of nearly $178,000

DES MOINES – An attorney who represented defendants in Clay County legal cases has been fired after state auditors uncovered he overcharged taxpayers by tens of thousands of dollars during a special investigation, according to a report released today.

Ney McDaniel, an attorney who contracted with the Iowa State Public Defender, overcharged the state at least nearly $178,000 from Aug. 31, 2007 to March 31, 2011. Most of the charges came from additional hours billed during which no work was allegedly performed and overbilling for mileage. In some cases, McDaniel claimed he worked more than 24 hours a day on multiple cases on the same day.

The state auditor investigation was spurred by complaints from the Clay County Attorney’s office, which has now referred the matter to the Iowa Attorney General’s Office, according to Clay County officials. The county attorney was unavailable for comment.

Attorney Ney McDaniel allegedly overbilled the state by nearly $178,000 for services that weren’t performed.

Eric Tabor, chief of staff for the Iowa attorney general, said his office just received the referral and will review the matter. If cause is established, they will take appropriate action, he said. There is no timeline for investigating the case, he said.

All phone numbers listed for McDaniel were non-working.

According to the Iowa State Public Defender’s office, the investigation has spurred a statewide review of attorneys hired to represent defendants when the county defender is unable to provide services. There is currently no audit procedure in place in Iowa to ensure the charges submitted are accurate.

Public Defender Sam Langholz said in a statement Thursday morning that four other contracts with attorneys have been terminated since the state’s increased scrutiny on the expenses.

McDaniel, perhaps the most egregious offender, claimed to work more than 24 hours in a day in 80 instances. His expense reports showed he also said he worked at least 20 hours in a day for 55 days during the period reviewed, according to the audit report.

Additionally, McDaniel reported more than $6,100 worth of mileage for multiple cases that occurred at the same location during the same day, resulting in 208 duplicated payments, auditors said.

This isn’t the first time concerns have arisen regarding Iowa’s contract with attorneys who back up county defenders, especially in the state’s most rural counties.

The state spent more than $30.5 million last fiscal year to hire contract attorneys for more than 61,000 cases in which they represented defendants who couldn’t afford their own lawyer. Of that, nearly $750,000 went to pay mileage.

Those expenses, as Langholz stated, are largely left unchecked unless local officials flag them.

Lawyers who take the cases are typically better poised to be named as judges when vacancies arise on the bench, state documents have showed.

Recent legislation required people who are represented to reimburse the court for lawyer expenses should their cases be dismissed. On average, the state currently recoups 10 percent of the money it spends, according to Langholz’s office.

Contact Sheena Dooley at dooley@iowawatchdog.org. Sheena Dooley is the Iowa bureau chief for Watchdog.org, where this story first appeared.