Mitchell Kossoff turned himself into authorities on Friday, an expected development after the prominent real estate attorney went AWOL earlier this year with millions of dollars in clients’ funds.
Kossoff has been charged with stealing $14 million from his clients, Law360 reported. His attorney informed the court that Kossoff intends to plead guilty to the top count of first-degree grand larceny, which carries a mandatory prison term, according to prosecutors.
Kossoff was freed on his own recognizance. A hearing is set for Dec. 9.
On Nov. 23, a prosecutor in Manhattan District Attorney Cyrus Vance’s office informed the judge overseeing the bankruptcy case for Kossoff’s law firm that the attorney had agreed to turn himself in and plead guilty.
Once one of the city’s top landlord lawyers, Kossoff ran a law practice catering to major multifamily owners, including Steve Croman and Larry Gluck. But after reports of erratic behavior earlier this year, Kossoff abruptly cut off contact with clients who asked him to return money he was holding in escrow.
By April, he was no longer returning calls from clients or even attorneys at his own firm. At the time, it was believed he was holding about $10 million in funds that could not be accounted for.
In his absence, the clients filed to have the firm placed into involuntary bankruptcy. The bankruptcy case, however, was complicated by ongoing investigations by both the Manhattan DA’s office and federal prosecutors.
Kossoff participated in the bankruptcy proceeding, but refused to turn over key documents, with his lawyers arguing that he could risk self-incrimination by doing so. At one point, he appeared at a virtual hearing with his camera turned off; the judge threatened to hold Kossoff in contempt.
Kossoff did not comment after leaving court on Friday, Law360 reported. According to the trustee in Kossoff’s bankruptcy case, the missing escrow funds now total nearly $17 million after more creditors emerged.
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[Law360] — Holden Walter-Warner