Suit Seeks to Claw Back Client Funds Used to Pay Lawyer's Personal Expenses
Businesses and individuals paid with money belonging to clients of disbarred Glen Rock, New Jersey, attorney Jay Lazerowitz are being asked in a fraudulent conveyance complaint to give the money back.
January 02, 2018 at 06:08 PM
3 minute read
Businesses and individuals paid with money belonging to clients of disbarred Glen Rock, New Jersey, attorney Jay Lazerowitz are being asked in a fraudulent conveyance complaint to give the money back.
Georgetown University, Syracuse University and BMW of North America are among the defendants named by court-appointed receiver Gary Norgaard in a complaint dated Dec. 28, 2017. Norgaard was appointed in November 2016 under a court order issued upon the request of the Lawyers' Fund for Client Protection. The Lawyers' Fund has received claims of $4.3 million from former clients of Lazerowitz.
Lazerowitz was suspended from practice in January 2016 and was arrested in September of that year after he continued to practice while suspended. The Bergen County Prosecutor's Office accused him of placing client funds in his regular business account instead of his trust account. He was disbarred by consent in October 2017, and has pleaded guilty to charges of unauthorized practice of law and misapplication of entrusted property.
According to the complaint, Lazerowitz has been engaged in a scheme to defraud his clients for nearly 30 years, converting client funds from his attorney trust account for his own personal expenses, and hiding his actions by paying back old clients with money from newer ones.
He signed a confession in September 2017 in which he said he began converting client funds in the early 1990s “to support a lifestyle my legitimate earnings could not support.” He used the funds for his personal bills, including “mortgage payments, credit card bills, college expenses, car leases, vacations, clothing, restaurants and other personal expenses.”
In 1993 and 1994 he started defrauding clients on a larger scale, “taking ever-increasing sums from my clients and spending the funds with the design to place them beyond the reach of my creditors” pursuant to the state fraudulent conveyance law, according to the confession.
Norgaard's complaint also seeks recovery from American Express, Neiman Marcus, check printer Deluxe for Business and a South Hackensack landscaping contractor for payments they received from Lazerowitz. Also named as defendants in the complaint are Lazerowitz's wife, Janet, and his sons, Evan and Ross.
The Lawyers' Fund has made payments to victims of Jay Lazerowitz in connection with claims filed with the fund, in the amounts of $348,757; $259,103; and $1,092,996.
Norgaard's firm, Norgaard O'Boyle of Englewood, New Jersey, was appointed as receiver's counsel and Bederson LLP of Fairfield, New Jersey, was appointed forensic accountant for the receiver in December 2016.
Norgaard's complaint seeks actual damages, counsel fees and costs from any of the parties that received converted funds. The complaint says JPMorgan Chase, American Express, Neiman Marcus, Deluxe for Business and a South Hackensack landscaping contractor received payments from Lazerowitz. Also named as defendants are three individuals—Ed Semitov, Lantefan Kurran, and Michael Shasho—whose connections to the case are not specified in court documents.
Norgaard says the complaint does not allege improprieties on the part of any defendants, but seeks the return of funds paid to them under the fraudulent conveyance law.
Lazerowitz, who was admitted to practice in 1983, graduated from the University of Maryland and the Pace School of Law. He was disbarred by consent on Oct. 31, 2017. John Lacey of Connell Foley in Newark, who represents Lazerowitz, did not return a call seeking comment.
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