Legal Ethics

In-House Counsel for Developer Didn't Stop $98M Mortgage Fraud, Loses Law License for 4 Years

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A sole practitioner who worked as in-house counsel for companies controlled by a New York real estate developer has lost his law license for four years, because he failed to detect and stop mortgage-origination fraud by the developer that cost lenders $98 million.

There is no evidence that Thomas Cusack knew of criminal activity and he didn’t make any money from the scam, Reuters reports.

However, “the evidence of his malfeasance is overwhelming” concerning his failure to perform standard lender’s attorney functions, wrote the New York Supreme Court’s Appellate Division, Second Department, in a Tuesday opinion sustaining 10 professional misconduct charges against Cusack.

Cusack’s lawyer said he was “duped” by developer Thomas Kontogiannis, who pleaded guilty in 2010 to conspiracy to commit bank and wire fraud.

An earlier post provides additional details:

2 NY Lawyers Sued, 1 Disbarred re Their Claimed Roles in Convicted Developer’s $92M Mortgage Fraud

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