Parente settlement could help Ponzi victims

A legal battle over Garden City lawyer William Parente's estate has ended with a settlement that puts the lion's share of money in reach of investors he was accused of defrauding in a multimillion-dollar Ponzi scheme that was unraveling when police say he killed his family and himself nearly two years ago.

In addition, proceeds from the sales of William and Betty Parente's properties, which now total more than $540,000, will go to the slain wife's family, according to a transcript of a Nassau Surrogate's Court proceeding last month.

The larger pool of money --- William Parente's $5-million life insurance trust -- will remain with the Nassau public administrator who is overseeing his estate. Barring other issues, it eventually will be distributed among dozens of people who invested money with William Parente, who in the end probably will receive a fraction of their losses, attorneys on both sides of the case said Wednesday.

The settlement also provided that lawsuits filed by Betty Parente's relatives be withdrawn or discontinued.

The bodies of William, 59, and Betty, 58, and their two children, Stephanie, 19, and Catherine Ann, 11, were found in a Maryland hotel on April 20, 2009. Baltimore County police said William Parente, a tax and estate attorney, killed his family before cutting himself and bleeding to death in the hotel room.

Dozens of people came forward saying they had given Parente money for unsecured bridge loans, triggering an ongoing FBI investigation into Parente's financial dealings. More than $30 million in claims have been made against his estate, although a final tally is still under way. Parente left no will and had less than $5,000 in the bank at his death, officials said.

The legal fight was led in large part by Betty's cousin, Joseph Mazzarella of Massapequa. Mazzarella argued against and later appealed a June decision by a Surrogate's Court judge to put the life insurance money in the hands of the county administrator overseeing William Parente's estate.

He filed a separate, $5-million claim in State Supreme Court against the estate, claiming pain and suffering and wrongful death in the hotel attack.

As part of the settlement, Mazzarella has withdrawn or discontinued those challenges, said one of his attorneys, Steven Cohn of Carle Place.

"This has been a trying experience, so I couldn't take it anymore and I had to take a settlement, and my wife thought it best," Mazzarella said Wednesday.

Under the agreement, he will establish memorials to Betty and the children at a total cost of up to $15,000, to be paid from the property-sale money.

"I want people to remember them," he said. Mazzarella, a funeral director, will receive up to $30,000 for funeral and burial services he provided for the family, according to the transcript.

The property money, expected to be distributed to the children of Betty's late sister, comes from the net proceeds of the sales of the couple's co-op in Bay Ridge, Brooklyn ($244,460) and a Westhampton home ($286,391, and $14,079 from a prior personal property sale. The family's home in Garden City is under contract, but lawyers said it is not expected to sell for more than what is owed on it.

The public administrator's account of Parente investors and their claims is expected to be filed in Surrogate's Court in April or May.

"I'm pleased to see there will be some restitution, though it will not be adequate," said Bruce Montague, a lawyer who was a Parente family friend and investor. Montague's firm submitted affidavits of more than 20 investors - nearly all of them lost more than $100,000 each - for claims against Parente's estate.

"My heart and my sympathies went out to many of the elderly investors who are no longer working, and many of them sick," he said.