DISTRICT ATTORNEY - NEW YORK COUNTY

NEWS RELEASE
February 14, 2008

Contact: Barbara Thompson
212-335-9400

Manhattan District Attorney Robert M. Morgenthau announced today that a Manhattan lawyer has pleaded guilty to stealing $2.1 million from his office’s escrow account.

The defendant, IRA BERMAN, pleaded guilty today to Grand Larceny in the First Degree and has been promised a sentence of 3 – 9 years in prison.  He also agreed to sign a confession of judgment at the time of sentencing.

The investigation leading to today’s plea revealed that BERMAN, a real estate lawyer with offices at 60 East 42nd Street, deposited real estate down payments into his firm’s escrow account and systematically stole $2.1 million to pay for his living expenses, as well as to fund his firm’s operating budget.

The case was referred to the District Attorney’s office by BERMAN’s attorney after a complaint was filed with the Departmental Disciplinary Committee of the First Judicial Department after a seller learned that the sale of his property could not go forward because the escrow money was missing.  Since that time at least eight individuals have filed complaints against BERMAN with the District Attorney’s Office.

For example, a couple who owned an inn in Southampton (The Village Latch Inn) retained BERMAN to represent them in the sale of the property. The prospective buyer gave $2 million to BERMAN to hold in his escrow account in August of 2007 while the details of the sale were finalized. The couple soon learned that BERMAN had misappropriated those funds. Another couple was selling their brownstone on West 88th Street and hired the defendant to represent them in the sale. Prior to the actual closing, they learned that $497,500 which had been placed into escrow by the purchaser was gone.  In August of 2007, another buyer placed $65,000 in the defendant’s escrow fund as part of a deal to purchase a Manhattan apartment on West 75th Street.  Again, the defendant stole the money from the escrow account and the victim learned of the theft through a letter she received from BERMAN.

To date, at least eight people have lost money that was placed in BERMAN’s escrow account – the amount missing is $3.2 million and there is only $1.1 million currently left in the account to be distributed to the aggrieved clients.

The defendant was suspended from practicing law by the Appellate Division, First Department on September 25, 2007 and a trustee has been appointed to help disburse the funds remaining in the defendant’s escrow.  In addition, the victims will be able to seek compensation from The Lawyer’s Fund for Client Protection of the State of New York. 

Assistant District Attorney Gary Snitow who is assigned to the Special Prosecutions Bureau was assigned to this case.  Assistant District Attorney Thomas Wornom is Chief of the Special Prosecutions Bureau.  James McHugh and Michael Vecchio of the District Attorney Financial Crimes Bureau assisted as did Paralegal Andrea Leung.

Mr. Morgenthau thanked the Lawyers’ Fund for Client Protection of the State of New York Executive Director Timothy J. O’Sullivan and Deputy Counsel Michael J. Knight, as well as Departmental Disciplinary Committee Chief Counsel Alan W. Friedberg and Staff Attorney Vitaly Lipkansky. Mr. Morgenthau also thanked Detectives Anthony Pasquariello and Patricia O’Connor of the District Attorney’s Office Squad. 

Defendant Information