Summary: Disbarred attorney Paul Karan, who stole around $2.6 million from his clients several years ago, entered a guilty plea for stealing several clients.
An 81-year-old former attorney pleaded guilty to grand larceny and scheme to defraud on Thursday in the Manhattan Supreme Court, according to a NY Daily News report. Paul Karan, a now disbarred attorney, stole roughly $2.6 million from his clients’ trusts and estates from April 2005 and August 2016.
Karan stole the money from the families he worked for during an 11 year period. He used that money to fund his lifestyle. The money went toward his mortgage payments but also to pay his country club fees, to dine out in New York, and vacations in Europe, according to prosecutors. The money came from two estates and ten trusts that Karan was either the executor or trustee over.
He is scheduled for sentencing on March 22 where he could get between two and six years in prison.
According to Bar Complaint, Karan was admitted to the bar in 1961. His most recent position was with Spizz Cohen & Serchuk were he was a partner. He was criminally indicted in August after an investigation by the office of Manhattan District Attorney Cyrus Vance Jr. He faced 13 counts at the time, 12 for grand larceny and one count of scheme to defraud in the first degree.
Karan was disbarred when he did not respond to the investigatory proceedings for the related allegations of misappropriation. He had already been suspended immediately at the beginning of last February by the Appellate Division, First Department, panel, for being a threat to the public interest. In their move to disbar Karan soon after, the panel stated, “not only has respondent failed to substantively respond to or appear for further investigatory or disciplinary proceedings since his suspension but, pursuant to a letter dated March 7, 2017, which was in response to a committee inquiry involving an allegation of misconduct, respondent reasserted his Fifth Amendment privilege against self-incrimination with regard to allegations underlying the grievance proceeding.”
The panel continued, “Accordingly, inasmuch as more than six months have elapsed since this court’s Feb. 23, 2017 suspension order, and respondent has neither responded to, nor appeared for, further investigatory or disciplinary proceedings.”
Karan had claimed at the time that he took around $250,000 because he had money issues following the death of his ill wife. He also claimed to a colleague at Spizz Cohen that he had a large tax bill from failing to pay an unincorporated business tax. Spizz Cohen immediately fired Karan and began an investigation and forensic audit into his files. The law firm is now defunct.
Partner Victor Rocco at Herrick Feinstein represented Karan.
Do you think Karan will end up serving time behind bars or will he be let off the hook because of his age? Share your thoughts with us in the comments below.
To learn more about lawyers that misappropriated client funds, read these articles:
- Former Schaumburg Attorney Stole from Clients, Including Own Uncle
- Former Sidley Austin Executive Committee Member Accused of Misappropriation
- California Lawyer Disbarred for Misappropriating $65,000
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