Monday, July 14, 2014
Inquirer Daily News

Charged in N.J., lawyer Kwasnik is arrested in Alabama

Michael Kwasnik told police he was headed to Texas to see a friend and planned to turn himself in afterward.
Michael Kwasnik told police he was headed to Texas to see a friend and planned to turn himself in afterward.

Police in Dothan, Ala., said they arrested fugitive Philadelphia lawyer Michael Kwasnik on Wednesday on charges that he had stolen $1.1 million from an elderly Cherry Hill widow.

Dothan Police Chief Gregory Benton said the arrest was made after police received a tip about a man at a Greyhound bus station transporting narcotics. Police said they found no narcotics but apprehended Kwasnik on money-laundering and theft charges lodged Monday by New Jersey Attorney General Paula Dow.

Kwasnik was in possession of passports and maps, "items essential for out-of-country travel," police said. He told police that he was on his way to Texas to visit a friend and that he had planned to turn himself in after the visit.

Kwasnik was picked up with a female whom police declined to identify, because she was not named in the criminal charges.

Law enforcement authorities in New Jersey announced Monday that Kwasnik had been indicted by a state grand jury on four counts of theft and money-laundering in connection with the theft of funds from a 92-year-old widow in Cherry Hill who had hired him to manage her money and plan her estate.

Authorities also announced a lawsuit charging that Kwasnik, his father, William, and others orchestrated a Ponzi scheme that bilked elderly investors of $5.1 million, money that diverted to Kwasnik, his law firm, or to members of his family.

The company, Liberty State Benefits of Pennsylvania, along with its parent, Liberty State Financial Holdings Corp., a Cherry Hill-based company, filed for bankruptcy July 29.

Dozens of elderly people, who invested millions, are named as creditors in the proceedings. In related litigation, a court-appointed fiscal agent who is overseeing the company said that it had a negative net worth of $11 million and little means to repay investors.

New Jersey officials said on Monday that they had been assured by his lawyer that Kwasnik would surrender to authorities. Arrest warrants were issued, apparently late Tuesday, when Kwasnik failed to show up. The warrants appear on the national crime information computer, and Kwasnik's name came up when Dothan police did a check.

New Jersey officials said that the tip to Dothan police came from a taxi driver who was taking Kwasnik and the woman to the bus station.

 


Contact staff writer Chris Mondics at 215-854-5957 or cmondics@phillynews.com.

Chris Mondics Inquirer Staff Writer
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