Summary: A New York attorney’s initial arrest of stealing money from four clients last year grew to over 20 clients and almost $800,000 in missing money.
A Garden City, Long Island attorney pleaded guilty to stealing nearly $790,000 from clients. According to Nassau County District Attorney Madeline Singas, attorney Steven Morelli pleaded guilty to three counts of second-degree grand larceny and five counts of third-degree grand larceny.
Singas said, “Attorneys are entrusted with a special responsibility to act in their clients’ best interests, but instead this defendant treated his clients’ settlement funds as his personal piggy bank.”
Authorities claim that Morelli “retained and misused” settlement checks from February 2015 to August 2015. The amount he took the civil settlements from four clients, totaling around $150,000. When one of the clients asked about the money, Morelli stated, “The check was probably lost in the mail.” A client finally went to the police on December 29, 2015, prompting an investigation into the attorney.
Morelli’s scheme was to “receive settlement in regards to these lawsuits, the money would be placed into his account at the law firm.” Authorities found that once he deposited the money into the account, he would “almost automatically” withdraw the money and spend it. They now believe the started taking the settlements starting in June 2014.
The Nassau County Police Department’s crimes against property squad and investigators from the DA’s office discovered the Nassau detectives arrested the 59-year-old for the crime in February 2016. Further investigation uncovered 13 more victims at a loss of $573,000, leading to his re-arrest in May 2016. With more information from his second arrest, investigators were directed to another five clients that claim to have lost $64,000 to the attorney.
Pleaded guilty to a felony charge is automatic disbarment, according to the DA’s office. They state that Morelli used the money for personal and business purposes. He will return to court on June 9 for the sentencing phase. He faces 2.5 years to 7.5 years behind bars. He has agreed to pay $615,000 in restitution with $170,000 already paid back before his plea.
Morelli repaid the first three victims when he first learned that police were on to him. He still owed one client roughly $40,000 when he was arrested again. He entered a not-guilty plea during his first court appearance where he was charged with second-degree grand larceny and three counts of third-degree grand larceny. On his second arrest, Morelli was charged with three counts of second-degree grand larceny and ten counts of third-degree grand larceny.
His defense attorney, Marc Gann said, “This is a guy who has fought for his clients for years and organization may not have been his strong suit. I don’t think anything was done from a criminal intent perspective.”
Do you think Morelli was fully aware that he was stealing his clients’ money based on the fact that he told one client “the check was probably lost in the mail”? Or was he just bad at organization? Tell us your thoughts in the comments below.
To learn more about attorneys that stole from their clients, read these articles:
- Ex-Attorney Arrested for Stealing from Special Needs Clients
- Real Estate Attorney Stole $5.7 Million
- East Hampton Attorney Stole from Clients and Associates
Photo: newsday.com
