“The bigger they are, the harder they fall.” As reported originally in the Wall Street Journal, Binder & Binder, one of America’s largest Social Security Disability Advocate corporations is preparing for possible bankruptcy this week.
The company is facing roughly $40 million dollars in debt due in part to the expensive and ubiquitous late night commercials featuring Charlie Binder in his infamous cowboy hat. In addition, the company is getting squeezed due to shrinking demand for its services and greater government scrutiny of Social Security disability claims.
Binder & Binder was once a small Long Island law firm founded by brothers Harry and Charles Binder. Over the years, they grew exponentially due to TV and internet advertising. The firm was eventually converted into an advocacy corporation with non-lawyer representatives. In 2010, the brothers sold a large stake in their company to a division of H.I.G. Capital, a Miami-based private-equity firm, for an undisclosed sum. Sounds like the brothers got out just in time, and HIG investors may now be holding the bag.
In my opinion, this is a good example why Social Security disability representation should be left to smaller local law firms rather than mega-national corporations with non-attorney advocates. The Social Security Administration should rescind fee withholding for non-attorney advocates which are the steroids allowing Binder & Binder and similar corporations to grow exponentially.
It is clear that the Binder & Binder non-attorney advocate business model may now be imploding on a massive scale, and its reported 57,000 clients are possibly at risk.