Former Legal Tech Entrepreneur Federally Indicted for Wire Fraud and Money Laundering

Regular readers of this blog may remember that I have written a number of posts about Derek Bluford, a one-time rising star on the legal tech start-up scene whose star fell after I reported in 2016 of his settlement of a lawsuit charging him with impersonating a lawyer, forging legal documents and fraudulently swindling two clients.

Derek Bluford

On Wednesday, a federal grand jury in Sacramento returned a five-count indictment against Bluford, charging him with wire fraud and money laundering.

When I first wrote about Bluford, he was slated to be featured two weeks later at a Legaltech West Coast program on legal innovation. Just 28 years old at the time, he had achieved success and won accolades as an entrepreneur, first starting California Legal Pros, a company that marketed various legal services to both consumers and lawyers. then QuickLegal, a service that provided on-demand legal advice to consumers, and then QuickLegal Practice Management, a cloud practice management platform for lawyers.

Following my report, QuickLegal shut down, but then seemed to be reincarnated in another similar startup called LawTova. After I wrote about that company (here and here), it too shut down. I then wrote about yet another startup that had ties to Bluford and QuickLegal, which has also since shut down.

This week’s indictment tracks the allegations of the civil lawsuit I reported on in 2016. The U.S. Attorney’s Office in Sacramento alleges that Bluford told a couple that he was an attorney and could represent them in a dispute with their tenant. After the couple agreed, Bluford told them that they had incurred numerous fines and court costs, as well as costs to repair their rental unit; he also told them he had negotiated a settlement agreement with the couple’s former tenant. Based on these representations, the couple paid Bluford at least $535,000. Of course, Bluford was not an attorney and there were no fines or court costs. Bluford then allegedly laundered the proceeds from his scheme, according to the indictment.

If convicted, Bluford faces a maximum statutory penalty of 20 years in prison on the wire fraud count, 10 years in prison on the money laundering counts, and a fine of $250,000, or twice the gross loss or gross gain, according to the U.S. Attorney’s Office.

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