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DA: Lido Beach attorney stole clients' escrow funds

Lido Beach attorney Susan Odery was arrested on

Lido Beach attorney Susan Odery was arrested on Wednesday, March 19, 2014, and charged with stealing more than $16,000 in escrow funds from clients. Credit: NCDA

A Lido Beach attorney was arrested Wednesday after stealing more than $16,000 in escrow instead of using the funds to pay off state taxes on the sale of her clients' apartment, the Nassau district attorney's office said.

Susan Odery, 56, was arraigned on two counts of third-degree grand larceny and released on her own recognizance, prosecutors said.

The victims, a mother and daughter from New Jersey, had filed a complaint with the district attorney's office after the state taxation department fined them last April for failing to pay the estimated tax on the sale of their New York City apartment.

They had closed on the sale April 25, 2012, and they expected $16,758 in escrow funds to be applied toward the taxes, according to District Attorney Kathleen Rice.

They repeatedly called Odery about the state tax penalty, and the attorney gave them several excuses, prosecutors said. Odery first said it was a mistake and that she'd take care of it, authorities said. At one point, she claimed the files had to be retrieved from archives, but that they may have been damaged by superstorm Sandy, Rice's office said.

Investigators learned that Odery had written two checks to New York State at the closing to pay taxes. But when state officials tried to cash the checks May 16 and 18, 2012, the checks were returned unpaid, prosecutors said.

Odery's bank later told Rice's investigators that the attorney had put a stop payment order on the checks and that the escrow account did not have enough money.

"The attorney-client relationship is pivotal to the functioning of our society and when that bond is broken, our entire legal system is weakened," Rice said in a news release announcing Odery's arrest.

Odery is due back in court April 4. She and her attorney could not be immediately reached Wednesday.

Court documents show that Odery's law license was suspended in October by the Tenth Judicial District, which covers Long Island and was investigating another complaint against the attorney.

In suspending her license, the committee declared her guilty of "serious professional misconduct" and found "uncontroverted" evidence against her in a matrimonial case that involved a real estate closing.

Odery failed to file a December 2006 real estate closing for her client, the wife, and took escrow funds that were supposed to pay off recording fees and transfer taxes, according to the committee's decision. That forced her client to redo the closing in February 2011, resulting in more closing and legal fees.

Odery blamed the husband's attorney, saying she had sent the check, according to the decision. As proof, she sent a copy of that escrow check for $3,847.87, which was made out to "Judicial Research," but the back was not endorsed, the committee said.

After subpoenaing certified copies of bank records, the grievance committee saw that the check was actually made out to Odery, signed by her and deposited into her personal account, according to the committee's decision. Under oath, the committee said, Odery denied she had written the check that was deposited into her account.

The grievance committee has started a disciplinary proceeding against her.

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