Ex-title insurance exec who defrauded Extell sentenced to 20 months in prison

TRD New York /
Sep.September 21, 2011 10:19 AM

alternate
text
Brian Madden
Brian Madden, president and co-founder of title insurer Liberty Title Agency, was sentenced to 20 months in prison for misappropriating and embezzling escrow and other client funds from Liberty Title and two other insurance agencies he controlled, the office of the U.S. Attorney for the Southern District of New York announced today.

Beginning when the real estate market was crashing in 2008, Madden took about $2.2 million from Liberty Title. To support these withdrawals, Madden paid current client debts with new funds he collected from other clients.

As The Real Deal previously reported, Extell Development was among the victims of Madden’s crimes. For its project at 535 West End Avenue, Extell wired funds to Liberty Title to pay $2.1 million in mortgage taxes. Liberty did not use the money for its intended purpose. Instead, Madden transferred funds from a smaller agency, to cover the payment, but it still lacked sufficient money to complete the transaction. These recording files were kept hidden in Madden’s office.

“Brian Madden held himself out to be an honest insurance broker who gave
his clients a false sense of security by leading them to believe
their property was protected against potential loss,” Manhattan U.S. Attorney Preet Bharara said in a statement. “In reality,
he raided their accounts for his own personal gain and stole from
one client to pay another to cover his tracks. His crime spree
has come to a fitting conclusion.”

Madden pleaded guilty to wire fraud and embezzlement in December 2010. He was originally eligible for between 63 and 78 months, but he filed an objection for a weaker punishment because the losses caused by his actions amounted to less than $2.5 million (note: correction appended).
— Adam Fusfeld


Related Articles

arrow_forward_ios
One Manhattan Square Extell Development CEO Gary Barnett (Credit: Curbed NY)

Extell lands $690M refinancing package for One Manhattan Square

Gary Barnett

Quantifying the rise and fall of NYC’s condo market

Monique Baugh (Credit: Facebook)

Real estate agent abducted during showing and then murdered

Creston Apartments at 2030 Creston Avenue in the Bronx (Credit: Google Maps, iStock)

Construction firm with alleged mob ties worked on Bronx affordable housing project

50 West 66th Street and Extell Development CEO Gary Barnett (Credit: Binyan Studios via Curbed NY)

Extell accuses City Club of reneging on settlement over UWS tower

Extell Development chairman Gary Barnett with 555 Tenth Avenue and 524 East 14th Street (Credit: Barnett by Anuja Shakya, 555ten and StreetEasy)

Extell scores $700M refi for three Manhattan buildings

Former HFZ Capital Group executuve John Simonlaca (Credit: HFZ, iStock)

Meet the HFZ exec accused of taking mob bribes

HFZ managing director John Simonlacaj and The XI development (Credit: LinkedIn and Wikipedia Commons)

HFZ’s High Line condo-hotel project was ATM for the mob, prosecutors say

arrow_forward_ios
Loading...