A Pennsylvania state fund supported by attorney registration fees will pay $3.25 million to victims of an elaborate Ponzi scheme masterminded by a prominent Pennsylvania lawyer. Anthony Lupas, a former long-time school district solicitor and father of a local judge, was arrested back in May 2012 and charged with bilking dozens of victims who thought their funds were being invested in tax-free trusts yielding 5% annually. Criminal proceedings against Lupas remain on hold while his attorneys fight efforts to declare him competent for trial.
According to authorities, Lupas offered clients the ability to earn a steady 5% return through an investment in tax-free trusts. This continued for years, until Lupas suffered injuries in a 2011 fall that allegedly diminished his mental faculties. Lupas's injuries resulted in his inability to keep up with investor payouts, and his his son, Judge David Lupas, would later contact authorities after discovering certain suspicious circumstances surrounding his father's investment operations. After an investigation, the elder Lupas was arrested and charged with 29 counts of mail fraud, one count of conspiracy to commit mail fraud and one count of conspiracy to commit money laundering.
The Pennsylvania Lawyers Fund for Client Security is a fund created by the Pennsylvania Supreme Court in 1982 to compensate clients whose funds were misappropriated by their attorneys. The fund is wholly funded by state lawyers, who pay an annual fee towards upkeep of the fund, and each award is limited to a maximum of $100,000. A total of 47 of Lupas's victims will share in a $3.25 million award from the fund.
While Lupas's lawyers recently argued that he suffers from an advanced stage of Alzheimer's disease and suffers hallucinations, prosecutors argue that Lupas is likely faking his condition in an effort to continue to dupe others to win his freedom. Both the government and Lupas's defense team called medical experts to support their cause, and U.S. District Judge Robert D. Mariani is expected to issue a decision shortly. While a conviction on just one of the thirty-one charges he is facing would effectively be a life sentence for Lupas, he potentially faces hundreds of years in prison if convicted on all counts.
For more news and analysis of Ponzi schemes, visit Ponzitracker, a blog by Jordan Maglich, an attorney at Wiand Guerra King P.L.
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