Disbarred For Fraud On Japanese Client: Attorney Used Funds For Comic Books And Sports Memorabilia
A felony conviction has resulted in automatic disbarment of an attorney by the New York Appellate Division for the First Judicial Department.
The court noted a prior disciplinary matter
…this Court suspended respondent from the practice of law for two years, and until further order of this Court, for his use of obscene, insulting, and threatening language in correspondence addressed to, among others, his former wife and her matrimonial attorneys, and his filing of a meritless federal lawsuit against his former wife, her attorneys, various judges, and others (see 78 AD3d 9 [1st Dept 2010]). To date, respondent has not applied for reinstatement.
The disbarable crime
Respondent’s conviction stemmed from his employment with Tadano, a Japanese crane manufacturer. In January 2009, Tadano hired respondent to be the head of its legal affairs and human resources department. Respondent was responsible for contracting with outside law firms to handle Tadano’s litigation and for approving payments for legal services. According to Tadano, respondent never informed the company of his suspension from the practice of law in New York.
In April 2011, respondent filed documents with the Texas Secretary of State to form a Texas corporation, Maio & Cardenas, LLC, a fictitious law firm for which respondent was listed as the registered agent and managing member. From approximately May 2011 to May 2012, respondent caused Tadano to issue checks totaling $9,329,546 to Maio & Cardenas for legal services it never performed. Respondent deposited the checks into an account he controlled and then used the funds to purchase, among other things, artwork, collectible comic books and sports memorabilia. Tadano terminated respondent’s employment after learning of his fraudulent conduct.
More from Chron
When authorities raided Anthony Chiofalo‘s home and storage units after he was accused of embezzling more than $9 million from his employer, they found hundreds of valuable items including a baseball signed by Babe Ruth, a first edition Playboy and the first ever Batman comic book, worth about $900,000.
“He had sports memorabilia and very expensive comic books, that are like bearer bonds because they’re hard to trace,” said Bryan Vaclavik, a financial fraud consultant. “I think he was buying comic books as an investment and we are trying to locate each and every one of those comic books.”
He said there are still comic books missing that are worth hundreds of thousands of dollars. Chiofalo, 51, of Spring, appeared Monday in a Harris County court for the first time
Court records show that Chiofalo had hundreds of sports memorabilia collectibles including a boxing robe worn by Muhammad Ali, a signed first edition of Mario Puzo‘s novel, “The Godfather,” and a baseball helmet signed by Pete Rose. Authorities also recovered dozens of signed posters and scores of baseball cards.
(Mike Frisch)