May 21 (Bloomberg) -- Martin Weisberg, a former partner at law firm Baker & McKenzie LLP, pleaded guilty to stealing from a client’s account and taking part in a $55 million securities fraud scheme.
Weisberg, 61, entered his plea to money laundering and conspiracy charges today in federal court in Brooklyn, New York. He was indicted in 2008 on wire fraud and money laundering charges for taking money from an escrow account established on behalf of a corporate client.
Weisberg, who resigned from Baker in October 2007, was accused of placing $30 million in an interest-bearing account and wiring out about $1.3 million without the client’s knowledge, according to U.S. prosecutors. He concealed the theft by telling the unidentified client that the bank holding the account didn’t produce monthly statements, while sending letters to the client with false balances, the U.S. said.
The theft-related charges were filed after Weisberg was charged with conspiracy in 2007 over his role in a stock fraud.
The government said that Weisberg conspired with Xybernaut Corp.and Ramp Corp. executives in a conspiracy involving short-selling. Prosecutors said the defendants caused Xybernaut, a Fairfax, Virginia-based maker of wearable computers for aircraft mechanics and telephone linemen, and Ramp, a bankrupt developer of health-care software, to issue hundreds of millions of dollars of heavily discounted shares through offshore entities between 2001 and 2005.
Weisberg faces maximum sentences of 10 years on the money-laundering count and five years on the conspiracy charge. Weisberg, who earned his law degree from Northwestern University Law School in Chicago, also may have to forfeit proceeds and lose his law license, according to prosecutors.
The case is U.S. v. Saltsman, 07-cr-641, U.S. District Court, Eastern District of New York (Brooklyn).
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