A former attorney and a longtime friend of former Suffolk County Executive Steve Levy was sentenced Friday to 840 hours of community service and 5 years of probation for his role in the largest mortgage fraud scam in county history.
Ethan Ellner, who had a law practice in Ronkonkoma, pleaded guilty to second-degree grand larceny and cooperated against the fraud's ringleaders, Manhattan publisher Donald MacPherson and former Suffolk Legis. George Guldi, both of whom are serving sentences of 4 to 12 years in prison.
The scheme bilked lenders out of more than $82 million. MacPherson and his wife, Carrie Coakley, recruited straw buyers at The Dungeon, a Manhattan club where she was the dominatrix in charge.
MacPherson provided false employment at his company, and he, Guldi, Ellner and other attorneys scammed lenders by inflating purchase prices, fabricating documents and having the straw buyers purchase the houses, obtain mortgages and then default on the loans.
Assistant District Attorney Thalia Stavrides acknowledged Ellner's "extensive cooperation" and said the sentence imposed by Suffolk County Court Judge James F.X. Doyle was appropriate, particularly since Ellner was disbarred and lost his livelihood. He was disbarred after pleading guilty in 2009.
Perini told Doyle that his client tried to set things straight with his cooperation, but Doyle said that could go only so far. "I wouldn't say it's making things right, given the amount of money involved," Doyle said.
While Levy was county executive, Ellner got more than $85,000 in county title work on Levy's recommendation even though Ellner had been convicted of federal tax evasion and was cited for "unconscionable trade practices" by county consumer affairs officials.
During Guldi's trial, Ellner testified that he got county title work after paying a bribe to a "high county official" through a holding company. Campaign records showed the company's chief executive was Ellner's mother and that the company contributed only to Levy.
Levy has denied any wrongdoing. He declined to seek re-election last year as part of an agreement with District Attorney Thomas Spota, who was investigating his campaign fundraising.