June 3, 2010 6:31 PM
Winston & Strawn Lawyer at Center of Financial Adviser Case
Posted by Zach Lowe
If you've got 30 minutes to kill and are interested in (alleged) white-collar crime, we highly recommend reading the federal criminal complaint (available below) about Kenneth Starr, financial adviser to the stars, and Andrew Stein, the former Manhattan borough president charged with tax fraud. It offers a fascinating glimpse into the desperation an alleged white-collar criminal feels when he needs money to continue his scheme and can't get at it quickly enough to satisfy increasingly suspicious clients.
As you probably know, Starr, a nonpracticing lawyer, faces several fraud counts linked to his alleged misappropriation of $7 million in client funds that he used to buy a fancy apartment and invest in vehicles linked to his friends. (Stein was apparently one of those friends.) An unnamed lawyer who did work for Starr plays a central role in the complaint, which identifies the lawyer only as a partner in a prominent national law firm.
Bloomberg dug in and identified the lawyer as Jonathan Bristol, a Winston & Strawn partner who worked at Thelen before that firm collapsed. And guess what? Bristol, who has not been charged with committing any crimes, is no longer listed on Winston's Web site.
Asked about Bristol's status with the firm, Winston spokesman Darryl Van Duch said via e-mail: "The firm cannot comment publicly on this matter."
In any case, Bristol, according to the complaint, served as Starr's go-to lawyer and controlled an attorney trust account through which Starr transferred client funds that were then spent on things about which the clients had no knowledge, including that $7 million apartment. The account was linked to Bristol personally, not Winston, the complaint says.
One unidentified client, for instance, became concerned when her bank informed her that Starr had transferred $750,000 of her money into Bristol's account. When the client's lawyer confronted Bristol about the transfer, he claimed to be in the dark and said that perhaps the client had authorized a loan for one of Starr's real estate projects. The client had done no such thing, the complaint states.
A second client found out in April that Starr had transferred about $1 million of her cash into Bristol's account without her authorization, the complaint says. When the client demanded the money be returned, Starr told her over the phone that Bristol could not be reached. But the client decided to call Starr's bluff and phone Bristol's office at Winston. She got in touch with Bristol immediately, and Bristol told her he had no idea about the $1 million wire transfer, the complaint says. Bristol then lashed out at Starr, telling Starr that "you bungled me up on this," the complaint states.
Even worse for Bristol: In mid-April, about $7.1 million was transferred out of his account to pay for Starr's new apartment, the complaint states. Of that $7.1 million, exactly $6 million was initially transferred to an account linked to an unnamed law firm. Lawyers working on the case have so far declined to identify that law firm, but we're still digging around. It appears from the complaint that the firm was playing some role in helping Starr close the deal for his apartment. Prosecutors working on the matter declined to comment through a spokeswoman. Bristol could not immediately be reached for comment.
Needless to say, this is a story we'll be following.
Footnote for sports fans: Julius Erving (yes, Dr. J) makes an uncredited cameo in the Starr complaint. Starr allegedly wired client money to a company called Sundown Hills, which filed for bankruptcy earlier this year in Georgia. Erving is a member of the Sundown Hills corporation and listed himself as a debtor on the company's bankruptcy filings. Erving and Starr are close friends, the complaint says.Make a comment