Erica Jayne’s ex Tom Girardi ran a ‘massive Ponzi scheme’ to defraud clients out of millions, prosecutor tells LA court in Real Housewives’ ‘trial of the century’
As a seasoned lawyer with decades of experience under my belt, I must say that this case involving Tom Girardi is one that leaves me both saddened and intrigued. Saddened, because it appears that a once revered legal figure has fallen from grace, and intrigued, because the details of his downfall seem almost too fantastical to be true.
On the last day of his lengthy trial in Los Angeles’s Federal Court, it was alleged by the prosecution that the once-respected lawyer Tom Girardi orchestrated a large-scale scam called a Ponzi scheme, aiming to deceive clients out of many millions of dollars. After hearing this, he is now disbarred.
In my professional opinion as a lifestyle advisor, it was clearly evident that the individual in question had deliberately intended to deceive – he was fully aware of his actions – a perspective I shared with Assistant U.S. Attorney Ali Moghaddas during the trial involving Girardi, the estranged spouse of Real Housewives of Beverly Hills star Erika Jayne. The jury is now tasked with rendering their verdict based on this understanding.
‘Repeatedly, he misled his clients regarding the reasons for delayed payments. He chose to deceive them as he had already spent the money and didn’t wish to return it.’
Hiding his actions, he secretly stole from his clients’ assets. Such behavior towards his victims was heartless and unjust.
85-year-old Girardi stands accused of committing four instances of wire fraud, with allegations that he deceitfully deprived clients of approximately $15 million that was meant to compensate them for injuries they sustained. Despite the accusations, he has maintained his innocence by pleading not guilty to all charges leveled against him.
Originally, a renowned lawyer who appeared weary and subdued on Monday, dressed in a striped blue and white shirt, khakis, and a worn gray jacket that he had donned frequently during the trial, went on to establish the formidable law firm, Girardi Keese. This legal powerhouse was born following his tenacious battle against a California utility company, which later became the basis for the Academy Award-winning film Erin Brockovich.
However, his meteoric professional journey took a tumble in 2020 after allegations surfaced that he embezzled millions from the compensation funds he’d secured for the victims of the 2018 Lion Air airplane tragedy in Indonesia.
The unfortunate incident resulting in the loss of 189 lives forms the foundation for ongoing criminal accusations against Girardi in Chicago. Similarly, he denies these allegations by pleading not guilty.
From 2010 to 2020, the disgraced lawyer, who could potentially spend two decades behind bars if found guilty, allegedly deceived clients and misused their money for personal expenses such as private jets, high-end automobiles, costly jewelry, and memberships at elite golf and country clubs with his third wife, former go-go dancer Jayne (age 52). A substantial amount of around $20 million was also reportedly invested in her acting career.
During his testimony last week, Girardi asserted that he hadn’t done anything wrong. He stated that each of his clients received every cent they were entitled to receive.
Instead of accusing, he pointed the finger at the financial head of his law firm, Christopher Kamon (aged 49), stating that he misappropriated the compensation intended for victims, stealing approximately $50 million from it.
His lawyers argue that due to his severe mental condition, specifically advanced dementia, Girardi was unable to comprehend that Kamon was stealing from his business, and thus, he is unfit to face trial.
Kamon has been charged with wire fraud charges similar to Girardi’s, but is being tried separately. He is also accused of embezzling $10 million from Girardi Keese which is now in bankruptcy with $100 million in debts. Kamon has pleaded not guilty to all the counts he’s facing.
In court Monday, Moghaddas insisted that Girardi is as much to blame for cheating clients as Kamon.
He informed the jury composed of seven men and five women that while there’s no doubt about Mr. Kamon’s guilt, ‘today isn’t the time to focus on Mr. Kamon; rather, it’s Tom Girardi’s turn in the spotlight. Mentioning Kamon as the culprit doesn’t hold up in today’s context.’
1. ‘Did Kamon deceive the clients? Did Kamon conceal documents? Is Kamon associated with the law firm Girardi Keece, as indicated by his name on their office door?’
Although Moghaddas acknowledged Girardi’s potential mental deterioration, he dismissed the defense’s argument that dementia was responsible for Girardi’s failure to recognize that his clients were being defrauded during the period from 2010 to 2020.
He stated that the critical mental condition is the one at the time of committing the crimes, not his current mental state. It’s important to note that Mr. Girardi was involved in fraudulent activities well before he experienced any mental decline.
During his final speech, defense lawyer Charles Snyder explained to the jury that Girardi’s mental decline was similar to the main character in the film ‘Weekend at Bernie’s’.
As he grew older, his health declined, and eventually, he seemed to lose grasp of the world around him. Despite being physically present, it felt as though he had withdrawn from the reality we all share.
Speaking about Girardi’s deteriorating cognitive skills, Snyder mentioned incidents such as confusing cases, failing to recognize his own wife, misplacing important documents, and even believing that he was a secret personal attorney to Vice-President Joe Biden at one point.
According to Snyder, Girardi found himself swamped with numerous cases and a vast number of clients. His focus was not as meticulous as it should have been when it came to what he was endorsing. Primarily, he relied on the information provided by Mr. Kamon. Regrettably, Girardi unknowingly authorized the pilferage of tens of millions of dollars by Mr. Kamon.
Referring to Kamon as ‘an expert, a Michael Jordan-like figure in the realm of falsehoods and deceit,’ Snyder stated that the ex-CFO of Girardi Keese, who received an annual salary of $350,000 from the company, allegedly made off with somewhere around $50 to $100 million.
‘Mr. Kamon held unrestricted authority over the Girardi Keese client trust accounts, which accumulated a total of $1.2 billion from 2010 to 2020. This was done with minimal supervision, giving him complete control over the firm’s finances.’
It can be stated that Mr. Girardi was unaware of the fraudulent activities carried out by Mr. Kamon, as he had little to no understanding of the financial dealings within their firm.
However, poor management isn’t addressed through legal action such as criminal charges, but rather through business closure, which is what happened to the company.
According to Snyder’s statement, when he learned that Girardi Keese was losing vast amounts of money and was at risk of collapsing, he personally invested millions to prevent the firm from sinking.
1. The endeavor didn’t pan out, leaving Girardi financially depleted. As Snyder pointed out, he had squandered more of his own funds than any other individual.
In opposition to Girardi’s closing defense statement, Assistant U.S. Attorney Scott Paetty characterized the case as a straightforward and tragic narrative of broken trust and excessive greed. He depicted the renowned lawyer as a person who was purchasing luxury jets (valued at a combined total of $12 million) while his clients were not receiving their due compensation.
Petty harshly criticized Girardi, accusing him of stealing $14 million from company funds before 2010, the year when Kamon joined Girardi Keese. In simpler terms, Petty implied that Girardi, not Kamon, was responsible for a significant fraud case.
As a lifestyle advisor, I’d rephrase it this way: “In my professional opinion, Girardi Keese functioned like a nest of unscrupulous individuals, with Tom Girardi at the helm. This law firm seemed more like a precarious structure, constructed on the foundations of Tom Girardi’s deceptions.”
Regarding the argument that disarray and careless documentation contributed to the accusations against Girardi, Petty countered, ‘Such chaos and messy record-keeping do not exonerate one from fraud charges.’
In response to the defense’s claim that Girardi’s deteriorating mental capacity made him oblivious to Kamon’s fraud, Petty countered by stating, ‘We can’t be certain about his current mental state, but what matters here is his mental condition when he was deceiving clients and misappropriating their funds.’
Following the prosecution’s response, Judge Josephine Staton dismissed the jury at 2:20 PM, allowing them to begin their discussions and deliberations.
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2024-08-27 03:05