Bail set at $1M for Philly lawyer Kwasnik

Philadelphia lawyer Michael Kwasnik was charged by New Jersey law-enforcement authorities on Monday with stealing $1.1 million from an elderly Cherry Hill woman who had hired him to manage her funds and plan her estate.

Kwasnik was charged in a four-count state grand jury indictment with theft by unlawful taking, misapplication of entrusted property and other criminal violations. Bail was set at $1 milllion.

The charges were announced by state Attorney General Paula T. Dow, who also unveiled a lawsuit against Kwasnik, his father William and several others, alleging they ran a multi-million dollar Ponzi scheme through an investment company that they controlled. Their victims were elderly investors, the suit said.

"We charge in our criminal case that Kwasnik exploited an elderly client, misappropriating more than $1 million she intended to give to her children," Dow said at a press conference in Trenton. "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.

"We will aggressively prosecute criminals who prey on this vulnerable segment of our population."

Stephen Taylor, director of the state Division of Criminal Justice, said that the indictment had been handed down on Friday and unsealed early Monday. He said that Kwasnik still was at large. Authorities said later they believed he was in Florida and that they were engaged in discussions with his lawyer.

The civil lawsuit, reported first in the Inquirer on Saturday, charges the Kwasniks raised some $8.5 million from investors, many of them elderly, for investment in their firm, Liberty State Benefits of Pennsylvania, and its parent, Liberty State Financial Holdings Corp., a Cherry Hill-based company.

The lawsuit charges that instead of using money for investment purposes, some $5.1 million instead was diverted to Michael Kwasnik, his law firm and members of his family. The lawsuit demands that the Kwasniks and other defendants return investor funds.