US lawyer sentenced nine years to prison over $8M escrow fraud
According to details of the case, the lawyer engaged in two related fraudulent schemes in August 2020.
A US court on Monday sentenced a lawyer to nine years to prison for defrauding his clients of funds he was holding for them in escrow.
Brian O’Neill, Managing Partner at his law firm, O’Neill & Partners LLC and an escrow agent pleaded guilty to two counts of wire fraud in November 2022, a statement from authorities there said.
According to details of the case, the lawyer engaged in two related fraudulent schemes in August 2020.
He is first said to have engaged in a scheme to defraud a medical equipment company by falsely promising to hold over $5 million of the company’s funds in escrow. Following the Escrow Agreement, O’Neill & Partners was to act as escrow agent for the transaction and hold $5.1 million deposited by the victim.
However, instead of holding that money as required, the lawyer is accused to have secretly used the funds to execute personal deals for the purchase of PPE, completely depleting the funds close to November 2020.
“In November 2020, Victim-1 cancelled the transaction and sent a letter to O’Neill & Partners requesting that the $5.1 million in escrowed funds be returned to Victim-1. When O’Neill & Partners refused to return Victim-1’s money, Victim-1 filed a civil action in U.S. District Court for the Southern District of New York,” the statement said.
In the course of the civil action, the court ordered O’Neill & Partners LLC to deposit the $5.1 million with the court clerk. But on September 22, 2021, O’Neill rather deposited $3.3 million with the Clerk.
That $3.3 million, according to US authorities, formed the basis of the lawyer's second scheme to defraud.
“That money was neither part of the $5.1 million Victim-1 had deposited nor was it O’Neill ’s own money. Instead, it consisted of funds being held by O’Neill in escrow for a separate transaction. In other words, O’Neill stole $3.3 million from a separate set of escrow clients in an attempt to satisfy the Court’s order in the civil action and repay Victim-1,” the statement further said.
In addition to his prison term, the lawyer was sentenced to three years of supervised release.
