Ex-Partner of Baker & McKenzie Indicted in $1.3M Client Theft Case
A former corporate partner in Baker & McKenzie’s New York office has been indicted for allegedly stealing $1.3 million from a client trust account. The money reportedly represents interest earned from a $30 million escrow account.
However, an attorney for Martin Weisberg says the money was a loan and has been repaid, reports the Wall Street Journal Law Blog. Weisberg was expected to plead not guilty at an arraignment today before a federal magistrate judge in Brooklyn.
As discussed in an earlier ABAJournal.com post, Weisberg, who is in his late 50s, resigned from Baker & McKenzie last year after being indicted in a securities fraud case. He pleaded not guilty in that case, too, which is ongoing.
The current charges “appear to relate to evidence uncovered in course of the firm’s internal investigation and turned over to U.S. Attorney’s office by the firm after Weisberg resigned,” partner Joe Linklater of Baker & McKenzie tells the WSJ blog. ”Weisberg concealed the escrow account from the firm and did not have firm permission to act as escrow agent.”
According to the new indictment, “Weisberg told three clients they would not receive interest on $30 million they deposited with him in an escrow account,” recounts the New York Law Journal. “Weisberg then allegedly deposited the money in an interest-bearing account which generated $1.6 million in interest between August 2006 and October 2007. Prosecutors claim Weisberg stole $1.3 million of it.”
If convicted, he faces up to 20 years on each wire fraud count and up to 10 years on each money-laundering count, as well as potential seven-figure fines.
A copy of the new indictment (PDF) is provided by the Wall Street Journal.
