ST. LOUIS, MO. (KMOX) — Brentwood attorney Steven Gartenberg will spend the next 24 months in prison for embezzling client funds from estates and family trusts. Gartenberg will also pay restitution.
According to court documents, Gartenberg did legal work involving five clients. One client hired him to assist with estate distribution and probate issues. Between February and July 2009, $411,000 was turned over to Gartenberg to distribute per the direction of the trust. A portion of those monies was to be paid to Kirkwood United Methodist Church, the Alzheimer’s Association and three individuals. Gartenberg instead diverted the funds to his law firm and/or converted them for his own personal use. The total loss to this estate is in excess of $100,000.
In March 2007, Gartenberg was appointed as guardian and conservator for another client who was deemed mentally incapable of managing her assets and daily affairs. He was to pay her bills and submit an annual statement to the probate court. Gartenberg was also required to post a surety bond while serving as guardian, and did so through the Bar Plan Surety and Fidelity Company. In June 2009, the court removed Gartenberg as guardian due to his failure to account for all expenditures. It was determined that Gartenberg embezzled in excess of $200,000 from this client.
Gartenberg also represented L.H.A./L.H.A. irrevocable trust. During 2006 and 2007 Gartenberg also represented LaTodd Properties in a collection action against three individuals related to a promissory note. In September 2006, Gartenberg received a Court approved consent judgment for two of the individuals to pay $24,000 to settle the collection matter. When he collected the money, instead of paying the client, Gartenberg converted this money to his own use.
During 2007, Gartenberg also represented MJ Investment Company in a collection action against an individual for unpaid rent. Gartenberg obtained a garnishment of $19,641 in satisfaction of this debt, but instead of paying the client Gartenberg again converted the money to his own use.
In September 2007, L.H.A. died and per the trust agreement Gartenberg became the trustee. In November 2007, Gartenberg paid LaTodd Properties and MJ Investment Company the monies owed for their collection cases. However, both of those clients were paid with money from the L.H.A. / L.H.A. trust and not monies that he had received for the two collection matters.
Gartenberg, pled guilty in June to two felony counts of mail fraud and appeared today before United States District Judge Rodney W. Sippel.
This case was investigated by the Postal Inspection Service. First Assistant United States Attorney Michael W. Reap handled the case for the U.S. Attorney’s Office.