A Philadelphia-area lawyer specializing in estate and financial planning and his father have been charged with cheating 74 elderly and retired victims out of a total of $9.6 million.
Michael W. Kwasnik, 42, who had law offices in Cherry Hill, N.J., is charged in a civil suit with selling unregistered securities to victims and using most of the $8.5 million for his own or his relative's uses or to pay off other investors in a typical Ponzi scheme.
He also has been indicted on criminal charges for taking $1.1 million from an elderly Cherry Hill, N.J., woman who hired him for estate planning purposes, according to New Jersey Attorney General Paula Dow.
He was supposed to set up a family trust for the benefit of the client and her children and administer the estate of the woman's deceased sister. Instead of taking money he received from her and putting it in a trust, he used it for his own purposes, including paying other clients and paying the operating expenses of his law firm, Dow says.
"Just as we allege in our lawsuit that Kwasnik preyed on elderly investors, we charge in the indictment that he took advantage of the frailty of this client and the trust she placed in him in order to deceive and steal," Dow says.
At the time of the alleged crimes, in late 2006, Kwasnik was the managing partner of a law firm with offices in Cherry Hill and Woodbury, N.J.
The indictment charges him with various financial crimes involving the elderly woman and her trust. He is also charged in a civil law suit by the New Jersey Attorney General's Office through the Bureau of Securities with raising $8.5 million by selling unregistered securities on which he promised an annual return of 12%. Also charged in this scheme is his father, William Kwasnik, 70, of Marlton, N.J., and three other individuals.
A warrant has been issued for Kwasnik's arrest and he is expected to surrender.
-Karen DeMasters