Pre-Paid Legal Services, Inc.

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This article is about the company. For the legal term, see Pre-paid legal services.

Pre-Paid Legal Services, Inc.
Type	Public
Founded	1972
Headquarters	Ada, Oklahoma
Key people	Harland Stonecipher (founder, CEO, chairman)
Industry	Multi-level marketing Pre-paid legal services
Products	Family Plan (Standard and Expanded), Business Owners Legal Solutions Plan, Law Officers Legal Plan, Commercial Drivers Legal Plan, Legal Plan for the Self-Employed, Identity Theft Shield, Legal Shield Rider, Home-Based Business Rider
Revenue	$423M
Website	www.prepaidlegal.com

Pre-Paid Legal Services, Inc. develops, underwrites and markets legal service plans through a network of more than 50 independent law firms across the U.S. and Canada. The plans provide for legal service benefits, including unlimited attorney consultation, letter writing, document preparation and review, will preparation, traffic violation defense, automobile-related criminal charges defense and a general trial defense. The Company also markets an identity theft restoration product.

1 History
2 Products
3 Criticism
4 References
5 External links

[edit] History

Pre-Paid Legal Services began on July 11, 1969 when CEO and founder Harland C. Stonecipher was involved in a vehicle accident which left him with legal bills. He began researching the industry of European legal expense plans. On August 8, 1972, Harland Stonecipher created Pre-Paid Legal’s predecessor, The Sportsman’s Motor Club, offering legal expense reimbursement services as a motor service club.Pre-Paid Legal selling plans through network marketing in 1983. Pre-Paid Legal went public on the NASDAQ National Market System in 1984, and two years later moved to the American Stock Exchange. On May 13, 1999, Pre-Paid Legal moved to the New York Stock Exchange, and within four months was listed as the 33rd fastest growing company on the NYSE, according to Equities Magazine.

In 2000, Pre-Paid Legal made the Forbes list of the 200 Best Small Companies in America for the fifth year in a row. The company currently provides services in all 50 states and four provinces in Canada, claiming over 1.5 million members. Currently most plans are sold through the network marketing system.

[edit] Products

Plans are sold by independent sales associates and can be purchased either by a one-on-one basis or in a group setting as the plans may be provided as an employee benefit. All Plans are non-contractual and may be purchased on a month-to-month basis or on a semiannual or annual basis.

Plans provide preventive legal services, which include telephone consultation on unlimited personal legal issues, document and contract review, and will preparation (with yearly updates). The Standard Legal Plan also provides motor vehicle services, trial defense, IRS audit assistance, and a 25% preferred member discount on any other legal issue. The exact coverages vary from state to state (or province to province) depending on local laws, and fees are adjusted according to the services provided in each state.

The company offers several riders which can be added to the basic plan for an additional fee, including the Legal Shield, which provides 24-hour access to an attorney in the event the member is detained or arrested, is seriously injured in an automobile accident, is served with a warrant, or if authorities attempt to remove the member's child(ren) from their custody; the Identity Theft Shield, which provides credit monitoring and identity restoration services; and the Home Based Business Rider, which provides services such as debt collection letters and an account with GoSmallBiz.com, a service designed to help expand, manage, and grow the client's own business. The Identity Theft Shield may also be purchased as a standalone product.

The company also markets several specialty plans. Specialty plans are designed to meet specific legal needs and are standalone products. Specialty Plans for business owners include the Small Business Legal Plan (1 to 50 employees), the Medium Business Legal Plan (51 to 99 employees), and the Legal Plan for the Self Employed. There are also the Legal Officer's Plan, the Foster Parent Legal Plan, the Commercial Driver Legal Plan, and the iPlan.

[edit] Criticism

Pre-Paid Legal has come under fire by both former members and legal authorities, charging fraud, deception, and accounting irregularities.

In 2005, a Mississippi jury found the company and CEO Harland Stonecipher guilty of fraud and deceptive advertising. A second jury added punitive damages to the verdict. ^[1]
In 2001, the Wyoming Attorney General classified Pre-Paid Legal as a "multi-level marketing" organization and won refunds for multiple customers who were defrauded. ^[2]
Allegations of "pyramid scheme" and customer fraud lead to 50% of new members dropping out within first year of signing on. ^[3]