BigLaw Attorney Is Accused by Client of Stealing $2.5M in Escrowed Funds
Posted Sep 22, 2011 1:22 PM CST
By Martha Neil
A counsel for Crowell & Moring no longer listed on the Washington, D.C., law firm's website has been accused by a client of embezzling some $2.5 million of escrowed funds.
Douglas R. Arntsen has been arrested and is being held in Hong Kong, where he is awaiting extradition to the United States, Reuters reports.
Last week, when Arntsen said he was moving to a new job, money allegedly started disappearing from Regal Real Estate's roughly $4 million in escrowed funds, William Punch, who serves as managing partner of the claimed victim, Regal Real Estate, told Reuters. When asked about the missing funds, Punch said, Arntsen "broke down and told me he had used some of the escrow money."
Attorney Bruce Lederman of D'Agostino Levine Landesman & Lederman represents Regal. He said Punch went with Arntsen to two banks on Sept. 13, where the lawyer withdrew nearly $2 million and gave it to Punch, Reuters reports.
Lederman told Reuters that the law firm is investigating and Regal expects it to replace the missing money.
Reuters says the Manhattan District Attorney's office is investigating but did not respond to a request for comment.
An article in the South China Morning Post (reg. req.) provides a few additional details. Citing an unidentified law enforcement source, it says that Arntsen is being held on remand at the Lai Chi Kok Reception Center and will appear next week in Eastern District Court.
A spokeswoman for Crowell & Moring declined to comment when contacted by the ABA Journal.