BULLETIN: Attorney Jonathan Star Bristol Now Under Arrest In New York; Lawyer Sued By SEC Earlier Today For Helping Kenneth Ira Starr Steal From Celebrity Clients
BULLETIN: Attorney Jonathan Star Bristol has been arrested by federal agents and is scheduled to make an appearance in Manhattan federal court this afternoon to face criminal charges of money-laundering amid allegations he helped convicted fraudster Kenneth Ira Starr siphon money from clients though an escrow fund.
“Today’s indictment should serve as a reminder to attorneys and others that you should always know the source, nature, and ownership of funds transferred through our financial systems,” said Charles R. Pine, IRS special agent in charge. “IRS Criminal Investigation is at the forefront of this type of investigation and will continue to hold professionals accountable in any field where they are entrusted with other people’s money and engage in money laundering transactions.”
Bristol was sued only hours ago by the SEC. Now comes word that there also was a sealed criminal indictment in the case.
“Jonathan Bristol, a lawyer and an officer of the court, allegedly helped his client Kenneth Starr hide the proceeds of his massive Ponzi scheme,” said U.S. Attorney Preet Bharara. “Along with our law enforcement partners, we will continue to pursue corrupt professionals in both the public and private sectors who betray their duties of trust.”
Pine said attorneys who turn a blind eye to sources of funds risk prosecution.
“A professional, such as an attorney, cannot knowingly use an escrow account funded with illegally obtained monies, or look the other way without questioning where the monies came from,” Pine said.
Among the specific criminal allegations against Bristol was that his former law firm was concerned that Starr had not paid $750,000 in legal fees he had racked up.
“In March 2010, Bristol reported to senior management that STARR would be paying $100,000 of the at least$750,000 that Starr owed,” prosecutors said. “Bristol’s law firm did receive a $100,000 payment that month, but it did not come from Starr — it came from Starr’s clients, laundered by Bristol through Bristol’s escrow accounts.”
Bristol also was accused of using the escrow accounts to help Starr steal $7 million to acquire a luxury New York condo with five bedrooms and 6.5 bathrooms, prosecutors said.
He also was accused of hoodwinking Starrs’ clients about how their money was being used.
“In 2009 and 2010, Bristol regularly used his escrow accounts to receive funds belonging to Starr clients and then transferred the monies directly to Starr & Co. to pay the company’s operating expenses,” prosecutors charged.