Wills, Trusts & Estates Prof Blog

Rhode Island Attorney Charged with Elder Exploitation, Larceny, and Embezzlement

As I have previously discussed, Warwick attorney, Janet Mastronardi, has been arrested for embezzling almost $150,000 from a client. Victim, Jane S. Jacques, suffered from severe dementia and other behavioral problems. A doctor had found that Jacques was paranoid that someone was going to steal from her. Col. Steven O’Donnell, superintendent of the state police, said Mastronardi stole $144,989 of her client’s money by writing 25 checks payable to herself over an 11 month period. 

Mastronardi had originally been charged with embezzlement and missappropriation. Recently, the court added elder exploitation to the charges and replaced misappropriation with larceny. This additional charge means that Mastronardi now faces up to 60 years in prison and a hefty fine of $40,000. It is suspected that Mastronardi may have taken the money because of her gambling debt. Mastronardi was serving as a court-appointed guardian for six other women when she was arrested. Mastronardi was arraigned on June 7th and pleaded not guilty to the charges. She was released on her own recognizance pending a pretrial conference scheduled for Aug. 27.

See Tracy Breton, Warwick, R.I., Lawyer Pleads Not Guilty to Embezzling From Elderly Client, Providence Journal, Jun. 8, 2013. 

Georgia Investment Adviser Misappropriates $2 Million from Widows

Blake B. Richards, a 36-year-old investment adviser from Buford, Georgia, allegedly "misappropriate[d] approximately $2 million from at least six individuals" according to a claim brought forth by the SEC.

Beginning in 2008, the SEC claims that Richards formulated several fraudulent schemes to embezzle money from clients, including two elderly victims who were attempting to roll over their retirement accounts.

Working under a separate company registered to his name, Richards allegedly had his clients write checks out to "Blake Richards Investments" or "BMO Investments" and would keep the money for himself. In one instance, Richards classified himself as an “Accredited Asset Management Specialist,” which was completely false.

Most of the money stolen consisted of retirement or life insurance proceeds from the victims’ deceased spouses. As a result, the SEC seeks to have "his assets frozen, disgorgement, penalties and an injunction."

See SEC Says Adviser Stole From Widows, Courthouse News Service, May 24, 2013.

Public Guardian Permanently Suspended Over Billing Practices

Nashville Probate Judge Randy Kennedy has permanently suspended Jeanan Mills Stuart, the public guardian of Davidson County, for charging excessive fees to elderly and disabled people in her care.

Stuart’s job as public guardian was to make legal, medical, and financial decisions for elderly and disabled people with no family or friends to make these decisions for them.  Stuart purportedly “charged those in her care legal rates of $200 to $225 an hour to perform tasks such as shopping or helping them move to an assisted living facility.”

See Nashville Judge Permanently Suspends Public Guardian, WSMV.com, May 22, 2013.

Law Firm’s Staggering $44 Million Contingency Fee Reduced to $2 Million

By order of the New York State Appellate Division, the firm Graubard Miller must reduce the fees owed by Alice Lawrence’s estate from $44 million to around $2 million.

Before her death, Alice Lawrence, the widow of commercial real estate mogul Sylvan Lawrence, hired Graubard Miller to represent her in an epic court battle against the executor of her husband’s estate.  The firm later convinced 80-year-old Lawrence to rework a new deal whereby the firm would receive a 40% contingency fee instead of Lawrence paying by the hour.

After negotiating a $111 million settlement, Lawrence owed the firm $44 million, roughly $11,000 an hour.  Because Graubard Miller failed to show that Lawrence fully knew and understood the terms of the new deal, the court “found that Lawrence’s estate should be charged the old hourly rate, which would add up to about a $1.7 million bill” and perhaps another $1.3 million in interest.

See Dareh Gregorian, State Appellate Judge Rules $11G per Hour a Bit Steep in Billionaire Estate Case, New York Daily News, May 24, 2013; see also Joseph Ax, Firm’s $44 mln Fee Request from Late Widow Reduced Again, Thomson Reuters, May 23, 2013.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

Estate-Planning Lawyer Faces 15-Count Lawsuit

Carleen Vogel Guenther, 75, died leaving three daughters. The daughters have filed a 15-count lawsuit against the estate-planning lawyer Sarah Laux, who has handled Carleen Guenthers affairs since 2008. The three daughters claim that the attorney swindled over $1 million dollars from their mother’s estate. Both the FBI and the IRS are looking into the allegations. The suit alleges that Laux forged documents and signatures, misrepresented material information, stole from the estate, and other serious allegations. Laux’s accounts were frozen, but after pleading with the judge, the order was lifted. Laux is limiting her withdrawals to the cost of living and legal expenses. 

See Bruce Vielmetti, Pfister Vogel Relatives Sue Mequon Woman, Alleging $1 Million Fraud, JS Online, May 21, 2013.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

Attorney Jailed After Trying to Revoke His Guilty Plea

In Rhode Island, federal judge William Smith, called an estate planning lawyers actions in a fraud case both "bizarre" and unjustified. Attorney Joseph Caramadre, tried to revoke his guilty plea made last November in a $30 million dollar elder insurance fraud case. Caramadre had pleaded guilty to defrauding people on their death beds into creating insurance investments in their names. The judge dismissed the attorney's request for a new trial. Additionally, the judge made it clear he was outraged by the lawyers actions when he agreed with prosecutors that Caramadre should go to jail because he was a flight risk.

See Martha Nell, Federal Judge Jails Estate Lawyer as Flight Risk, Nixes 'Bizarre' Effort to Revoke Plea, ABA Journal, May 21, 2013.

UK Government Decides Not to Regulate Will Writing

The Legal Services Board protects the interests of consumers in the United Kingdom by overseeing legal regulations.  After a two year investigation, the Legal Services Board recommended that the Ministry of Justice regulate will writing after finding “people’s lives were being ‘seriously damaged’ by incompetence or misdemeanor when drafting wills.”

The Ministry of Justice agreed that there is room for improvement, but rejected the notion that regulations were the right solution.  Although the Government will explore other options to increase consumer confidence in will writing services, the risk of consumers being left with unsuitable wills with no recourse still remains.

See Samuel Dale, Govt Rejects Calls to Regulate Will Writing, Money Marketing, May 15, 2013.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

Nashville Attorney Charged with Misappropriation in Conservatorship

John E. Clemmons is accused of misappropriating at least $450,000 from the estate of Nannie P. Malone.  Clemmons was appointed the elderly woman’s conservator in 2008.  After her death in 2012, Malone’s daughter alleges “that Clemmons had sold off at auction hundreds of thousands of dollars’ worth of Malone’s property but had failed to properly account for the proceeds.”  

Clemmons is accused of not making any itemized accountings during the auction, failing to account for numerous personal items, and neglecting to pay property taxes on two lots owned by Malone.  Clemmon’s license to practice law had already been suspended indefinitely for an earlier case finding Clemmons had improperly paid himself over $50,000 from the estate of a nursing home resident.

See Walter F. Roche Jr., Suspended Lawyer Faces Lawsuit in a Conservatorship Case, The Tennessean, Apr. 16, 2013.

Anthony Marshall’s Surrender Date Set, Wife Breaks Down in Court

As I have previously discussed, Anthony Marshall remains free on bail while he appeals his 2009 conviction.

Anthony Marshall and wife Charlene recently appeared in court to set the date for Marshall’s prison surrender.  If the Court of Appeals in Albany decides not to take Marshall’s case, Marshall must surrender on June 17. 

Charlene Marshall burst into tears during the court appearance, hugged her husband in his wheelchair, and told him, “You’re not going to jail, honey.”  Charlene was portrayed during her husband’s 2009 trial as “the greedy muse behind the swindling.”

Anthony Marshall and his lawyer Francis Morrissey face one to three years in prison after swindling Marshall’s famous philanthropist mother Brooke Astor out of over $60 million in bequests.  Marshall maintains he was merely providing for his wife if he were to predecease her.

See Laura Italiano, Emotional Wife of Anthony Marshall Breaks Down During Court Appearance, New York Post, Apr. 19, 2013.

Solicitor Charged With Fraud

A solicitor and coroner named Alan Crickmore from Cheltenham in England has been charged with fraud and the theft of over £3.7 million. Together Crickmore was charged with "seven counts of fraud by abuse of his position and one count of fraud by false representation between 1998 and 2011." Crickmore has been accused of altering the wills of his deceased clients. It is also alleged that he stole from his clients while he was acting as the executor of their estate.

In light of these charges, Crickmore has lost his certificate to be the coroner for Gloucestershire and his firm was closed by the Solicitors Regulation Authority. He recently appeared along side another man named Terrence Morris, who was charged with one count of fraud. Morris and him "were given unconditional bail until" June 12, 2013.

See Catherine Baksi, Solicitor Appears on £3.7m Fraud Charge, The Law Society Gazette, Apr. 19, 2013.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

Lawyer Who Stole From Aunt Will Likely Be Sentenced To Jail

Rik Bachman, a prosecutor, pleaded "no contest" "to second-degree larceny for stealing more than $200,000 from the accounts of his 85-year-old aunt." In 2009, Bachman took control of his aunt's, Beatrice Bachman, accounts. After assuming control, he allegedly kept her secluded from her other family members so that he could make large withdrawals from her accounts. Even after a judge ordered that Beatrice's accounts be frozen for her own protection, Bachman still continued to withdraw money. He apparently used the money that he stole to purchase sports memorabilia, which he had shipped to Beatrice's assisted living facility.

Bachman is set to be sentenced on June 28, 2013. The Senior Assistant State Attorney, Howard Stein, will likely demand that Bachman serve a three-year prison term or the maximum amount that he can serve. Stein argued that the maximum is necessary because of Bachman is an attorney. He claimed that Bachman should have been aware of the unlawfulness of his conduct.

See Daniel Tepfer, Lawyer, Who Stole $200K From Aunt, Faces Jail, Connecticut Post, Apr. 18, 2013.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

Cedar Rapids Attorney Disbarred

Susan L. Hense, an attorney from Cedar Rapids, Iowa, has admitted to misconduct and subsequently consented to being disbarred on December 27, 2012. Ms. Hense stated publicly that she deserved disbarment for stealing client's funds to support her gambling addiction. In total, Ms. Hense misappropriated $800,000 from her clients.

Ms. Hense has also entered "one-day-at-a-time" meetings to treat her gambling addiction. She claims that she has stopped her trips to casinos and gambling since she started treatment in October of 2012. Hense seems remorseful, and has offered to help the police in their criminal investigation. She also hopes that her involvement will help her former clients. The authorities at both the state and federal levels have not filed charges against Ms. Hense yet.

See Cedar Rapids Attorney Disbarred: Admits to Taking $800,000 Out of Clients Accounts For Gambling, The Gazette, Feb. 22, 2013.

Special thanks to Matthew D. Piersall for bringing this article to my attention.

Derzon Coins Sues Law Firm

As I have previously discussed, the true heirs of the Derzon Coins shop have sought retribution from Lori Laatsch and Diane Mehalko for the time they owned their parent's shop. Now it appears that the heirs to the estate has brought suit against "Cramer Multhauf & Hammes for more than $7 million plus at least $1 million in legal fees," claiming that the firm refused to divulge vital information about the case.

An attorney for the Cramer law firm stated that the firm's lawyers acted appropriately throughout the estate dispute between the rightful heirs and Laatsch and Mehalko. Cramer's lawyers claim that the firm has been portrayed unfairly by the media, and that they cannot wait to prove the falsity of these claims. One the people who has portrayed the Cramer law firm poorly is Milwaukee County Judge Carroll. Judge Carroll, the presiding judge throughout the dispute, openly chastised Cramer's lawyers in open court, claiming that the attorneys had altered or destroyed documents.

See Cary Spivak, Derzon Coin Heirs Sue Waukesha Law Firm, Journal Sentinel Online, Feb. 20, 2013.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

Judge Perrin Resigns

As I have previously discussed, Judge Perrin, the judge was convicted defrauding an elderly former client of hers. In the aftermath of her conviction, Judge Perrin has decided to resign her post. The Court Service of Ireland confirmed that the judge does indeed intend to resign her post. Perrin could possibly receive a maximum of five years in prison.

See Deception-bid Judge Set to Resign, Wexford People, Nov. 26, 2012.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

Texas Attorney Receives Probation For Misappropriation of Her Family's Estates

Michelle Valicek, a recently disbarred San Antonio attorney, received probation after she pleaded no contest to a charge that she had misappropriated funds from several of her family member's estates. The prosecutor on the case, Joanne Woodruff, reported that Valicek had stolen money from the estates and used it to purchase "an expensive house, a car and piano for herself." As a result of the case, Valicek voluntarily relinquished her license to practice law. She ultimately admitted that she made some mistakes in managing her grandmother's and her grandmother's nephew's estate. 

The judge probably agreed with Valicek and sentenced her to 10 years of probation. The judge could have sentenced her to ten years in prison. Now that the case is over, there are still a lot of questions that need to be asked. The primary one is where did half a million dollars that is gone from the estate go? There were also a number of questionable deals made by Valicek. For example, a neighbor of one relative noted that Valicek sold a relative's house for much less than what it was worth. If Valicek seeks to have her license restored she will need to wait five years after her probation is complete. At that time she will be 69 years old.

See Brian Mylar, Disgraced SA Lawyer Given Probation in Estate Case, KSAT.com, Nov. 20, 2012.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

Judge Perrin Guilty

As I have previously discussed, Judge Heather Perrin was accused a defrauding a former client by drafting a will that left a portion of his estate to her daughters instead of his nieces. The jury deliberated for less than four hours and returned a guilty verdict. Following the guilty verdict, the judge ordered Judge Perrin to relinquish her passport, and she "was remanded on continuing bail until November 28 for sentencing." Reports from the courthouse stated that Judge Perrin was visibly upset and shocked when the jury verdict was read aloud. She could possibly receive a maximum of five years in prison. According to BreakingNews, Perrin is the first judge in Ireland's history to be convicted of a crime as serious as the one that Judge Perrin committed. At the moment, she is still a presiding judge. In Ireland, judges can only be removed by a decision of the Olreachtas.

See District Court Judge Shocked By Guilty Verdict In Deception Case, BreakingNews.ie, Nov. 20, 2012.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

Caramadre and His Employee Plead Guilty

As I have previously discussed, philanthropist and lawyer Joseph Caramadre and his employee Raymour Radharkrishnan were indicted on a great number of counts for using fraudulently obtained information from terminally ill clients to make profit on death benefit annuities. Now, both men have pleaded guilty to two of the counts, wire fraud and conspiracy. Both men admitted to doing exactly what they were accused of doing. They were accused of "stealing the identities of terminally ill patients, lying to them, and lying to insurance companies to make millions in profits for themselves and dozens of other investors." The sentencing phase is scheduled to begin in February. Both men could receive 10 years in federal prison. 

See Jim Taricani, Philanthropist Pleads Guilty to Cheating the Terminally Ill, NBC 10, Nov. 19, 2012.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) and Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.

Ponzi Schemer Might Get Five Years In Federal Prison

Robert Telthorst, a Kansas attorney, pleaded guilty to wire fraud and money laundering. The attorney was accused of "stealing more than $460,000 from client trust funds in a Ponzi scheme." Telthorst admitted that he took money to cover up the fact that he was taking money from other clients' trust accounts. Telthorst began to take money from the clients' accounts after he was appointed to become the administrator the trusts. In one instance, he was appointed to administer the trust of man named "Otto K." Otto K. had a trust that was worth $463,344 for the benefit of his two daughters. The trust stated that he wanted to give his first daughter, Sherri T., a lump sum of money, while he wanted his second daughter, Marlene O., to receive monthly payments. Before he granted the lump sum to Sherri. T, Telthorst took $22,000 from the lump sum. In the case of the second daughter, Telthorst took more than $200,000 from her trust. He also took from the educational trusts of another client. There he depleted the three trusts that worth $10,000 each. He also drained the charitable trusts of two other clients worth $80,000. 

A court is ready to sentence Telthorst. The court will likely give him five years in federal prison, and order restitution in the amount of $460,000. 

See David Lee, Admitted Ponzi Schemer Could Get Five Years, Courthouse News Service, Nov. 14, 2012.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention

Kansas City Lawyer Accused of Killing Her Father Loses Control Over His Will

As I have previously discussed, the state has accused Kansas City Lawyer, Susan Elizabeth Van Note, with forgery and first-degree murder of her father, William Van Note. More specifically, the state alleges that Susan murdered her father by forgery his medical power of attorney to give her the right to refuse him life sustaining treatment. Now, a Clay County Probate Court has removed her "as the personal representative of her father's estate." At the moment, Van Note is out on a $1 Million bond. 

See KC Lawyer Charged In Dad's Death Loses Will Fight, KFVS12, Nov. 15, 2012. 

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

Davis From Perrin Trial Reportedly Not Suffering From Memory Problems

As I have previously discussed about this situation, Judge Heather Perrin stands accused attempting to deceive Thomas Davis, a former elderly client, into bequeathing a portion of his €1 million to her daughters. From our last discussion on this topic, Davis had taken the stand to provide his own side of the story and rebut the excuses presented by the defense. Now, it looks as if Dr. Michael Malone took the stand to address the mental cognizance of Mr. Davis. He testified that it did not appear that Mr. Davis suffered from any memory problems and concluded that Mr. Davis was "mentally fine." The prosecution hopes to use this testimony to rebut the allegations made by Judge Perrin that the mistake laid with Mr. Davis and that he had forgotten what had occurred. The doctor also stated that before Mr. Davis signed the will made by Judge Perrin, she contacted him to complete a form that attested to Mr. Davis' mental capacity. He conducted the examination and completed the form. He concluded by saying that any problems that were present occurred after the will was signed.

See Deception Trial: Elderly Man 'Not Suffering From Memory Problems', Breakingnews.ie, Nov. 14, 2012. 

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention