Lawyer pleads not guilty to charges of stealing $700G
Real estate attorney pleads not guilty to grand larceny charges
Newsday by ERIK GERMAN - email@example.com - January 22, 2009
East Meadow lawyer Frederic Powell was a real estate middle man who didn't just take a cut of the loans he brokered -- he sometimes pocketed the whole sum, Nassau prosecutors said Wednesday. Powell, 53, was charged with stealing $700,000 from two investors who'd made bridge loans -- money advanced to clients needing temporary cash as they arranged long-term mortgages. The terms of the loans -- one in 2006 and another in 2007 -- required the clients to make monthly interest payments through Powell, but prosecutors said he simply kept the cash rather than pass it back to the lenders. Prosecutors did not identify the victims. Powell pleaded not guilty to two counts of second-degree grand larceny in First District Court in Hempstead Wednesday and District Court Judge Robert Bruno ordered him released with no bail. If convicted, Powell faces a maximum of 5 to 15 years in prison. Powell's lawyer, Joseph Girardi of Syosset, said he was "completely confident Mr. Powell will be cleared of all charges." Girardi declined to discuss any details of a planned defense. In a statement, Nassau District Attorney Kathleen Rice accused Powell of "gross misconduct and unfathomable greed" and pledged to prosecute him aggressively.
Prosecutors said that, in February 2007, Powell brokered a $250,000 loan, promising to forward the borrower's monthly interest checks to the lender, followed by the fully repaid principle once the borrower obtained a new mortgage. After the payments became sporadic in 2008, the lender discovered the borrower had already repaid the loan to Powell, who simply kept it, prosecutors said. In 2006, a mother-and-son team of real estate investors fell victim to what prosecutors described as a similar scheme. Powell brokered the $450,000 loan for a client looking to expand his Manhattan business, prosecutors said. The mother and son put up half the cash and a third investor put up the other half. When payments became sporadic in early 2008, prosecutors said the third investor became anxious and the mother and son bought the man out. Soon after, the pair learned that the client had repaid the entire loan to Powell, who pocketed the money, prosecutors said.