Atlanta Feds Pinch Attorney For Allegedly Having Sticky Fingers When Handling Clients' Cash At R/E Closings; Head Fed: Racket Ran Like Ponzi Scheme

For the Office of the U.S. Attorney (Atlanta, Georgia):

• NEAL LANDERS, 45, of Duluth, Georgia was arrested [...] on federal charges that LANDERS stole money from his clients after acting as the closing attorney for their real estate transactions.

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• United States Attorney Sally Quillian Yates said, “In real estate closings, lenders trust the attorneys who represent them to fairly and honestly conduct the closings and appropriately handle the funds with which they are entrusted. This defendant is charged with running a Ponzi scheme out of his law firm, often using the proceeds from real estate transactions for his own personal benefit rather than the business purpose for which they were intended.”



• According to United States Attorney Yates, the charges, and other information presented in court: Beginning in 2007, LANDERS allegedly exploited his position as a closing attorney by misappropriating the funds from real estate transactions.



• Specifically, LANDERS is charged with receiving money transfers into his escrow account from several real estate closings. Once the real estate transactions were complete, LANDERS was required to disburse these funds. However, according to the indictment, LANDERS delayed paying out the funds for weeks and sometimes for months. Rather than promptly disbursing the funds for the recently-closed properties, LANDERS used those funds to pay out the parties from previously completed real estate transactions (who should have been paid earlier).



• LANDERS is also charged with transferring funds, in amounts that far exceeded any closing fees and/or costs, from his escrow account to a checking account. He then used that money to pay various personal expenses.



• Finally, LANDERS is charged with making false statements on a loan application. The fraud alleged in the indictment totals more than $1.5 million.

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• LANDERS was disbarred by the Georgia Supreme Court in 2009.

For the U.S. Attorney press release, see Disbarred Lawyer Indicted and Arrested for Running a Corrupt Real Estate Practice.