Upstate NY Couple Left In Limbo After Refinancing Home As Closing Attorney Is Charged w/ Pocketing Payoff Proceeds Due To Existing 1st Mtg Lender

In Lake George, New York, The Post Star reports:

• When Theresa Olson-Hoffman saw Patrick Reidy in the news last summer, in police custody and heading for a Saratoga County Court Room, she immediately recognized him. He was, she remembered, the same Saratoga Springs lawyer who had acted as a closing attorney when she and her fiancé completed paperwork to refinance a home loan almost a year earlier.

• Reidy, of Gansevoort, was charged with stealing more than $400,000 from area residents who came to him for similar services. Checks from those residents, which were intended for banks, were instead kept by Reidy, police said. Olson-Hoffman thought she was fortunate to have escaped her real estate transaction unscathed. “Thank God it wasn’t me,” she remembers saying at the time.

• Less than three months later, after a car crash prompted her to seek a new car loan, she discovered she wasn’t so lucky. Her credit, it turns out, was a wreck, and she soon learned the cause: Reidy had never paid off the first mortgage on a Lake George home she built in 2001, as he was supposed to do, Olson-Hoffman said. She has no idea what Reidy, who was working on behalf of the bank, did with the $135,000 check she had given to him.

***

• [O]lson-Hoffman and her finance haven’t been able to recover any of the money Reidy is accused of stealing from them. Lawyers have told them it’s unlikely they’ll see anything unless Reidy is convicted.(1)

For more, see Fraud case leaves Lake George pair in financial limbo.

(1) The victimized homeowners and mortgage lenders left unwittingly holding 2nd mortgages due to the attorney's failure to pay off the existing mortgages in the refinancing transactions might consider filing claims with The Lawyers’ Fund For Client Protection Of the State of New York, which was established to reimburse clients who have suffered a loss due to dishonest conduct of a member of the New York Bar. According to the Fund's website:

• The Trustees may reimburse losses caused by the dishonest conduct of lawyers admitted to the practice of law in New York State, up to a maximum of $300,000 for each client loss. Dishonest conduct means the wrongful taking of clients' money or other property, in the practice of law, after June 1, 1981. Clients must apply for reimbursement within two years after they discover their loss.

• Typical losses covered include the theft of money from estates of dead clients; escrow funds in real property closing; settlements in personal injury actions; and money embezzled from clients in investment transactions.

For similar "attorney ripoff reimbursement funds" established to reimburse clients who have suffered a loss due to the dishonest conduct of attorneys in other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.