LOS ANGELES –
A disbarred Beverly Hills lawyer plead guilty Monday to stealing more than $500,000 from a client he represented in bankruptcy proceedings, according to prosecutors.
He used part of the money to pay off a $75,000 debt, officials stated.
Alan F. Broidy, 65, plead guilty to a one-count information charging him with interstate transportation of stolen property.
U.S.District Judge Dale S. Fischer scheduled a Nov. 30 sentencing hearing. Broidy is facing up to ten years in federal prison.
According to his plea agreement, Broidy was hired to represent GRL-Mesa Investments LLC, a Phoenix-based company that filed for Chapter 11 protection in United States Bankruptcy Court in Los Angeles in December 2015.
In August 2016, the bankruptcy case was resolved and dismissed. Broidy was directed by the court to hold $2,469,926 in a client trust account – funds derived from the sale of assets belonging to GRL-Mesa’s bankruptcy estate.
This money was supposed to be distributed to Mesa’s creditors.
Although he transferred a total of $1,937,400 of Mesa’s funds to its creditors, including $975 owed to the U.S. Trustee, Broidy did not return the remaining $512,526 that belonged to Mesa.
Instead, he stole it and used it to pay for personal expenses.
Broidy admitted that on August 16, 2016, without his client’s knowledge or consent, he deposited $100,000 of Mesa’s money into his personal bank account, and then transferred $75,000 of that money to the bank account in New York of one of Broidy’s own creditors.
Through these unauthorized transfers that were hidden from Mesa, Broidy arranged to pay one of his own expenses with Mesa’s money, according to officials.
In July 2019, the State Bar of California disbarred Broidy based on the facts involved in this case.
This matter was investigated by the FBI.