A Greenfield attorney who allegedly defrauded four clients out of $2.2 million was indicted Tuesday on 33 criminal charges.
Sarah Laux has been under investigation by the Internal Revenue Service and FBI for some time. According to a release from Eastern District U.S. Attorney Jim Santelle’s office, the investigation surrounded her law practice, where she provided trust and estate counseling.
She is charged with two counts of bank fraud, nine counts of wire fraud, one count of mail fraud, 20 counts of money laundering and one count of filing a false tax return. She will be arraigned at 9:30 a.m. Dec. 12.
The indictment comes on the heels of other professional troubles. The state insurance commissioner’s office revoked Laux’s insurance license in January and ordered her to pay more than $584,000 in restitution to the Franzen family. The office found that Laux mishandled the family’s money and profited from it. It also ordered her to pay a $600,000 forfeiture, which represents the amount she allegedly profited from in stealing from the Franzens, and $32,000 for violating 32 insurance laws.
She also faces a May complaint filed by the Office of Lawyer Regulation. The OLR is asking the state Supreme Court to revoke her law license.
A message left at her office Wednesday was not immediately returned, nor was a message left for her attorney.
According to the release, Laux’s charges stem from four cases. They include:
- Defrauding Carleen Vogel Guenther and her family’s company, Eilcar Corp., by accessing their accounts and taking more than $1.6 million. She then used the money to buy residential property and an insurance business and to pay her bills and the bills of her law firm.
- Defrauding Associated Trust NA, which served as a trustee for a trust in which Guenther was a beneficiary, by lying and saying Guenther needed money from the trust to buy a condominium in a retirement home. The trust and its parent company, Associated Bank NA, then distributed $450,000, and Laux took the money. She also prepared false documents to conceal her alleged theft.
- Embezzling about $584,000 from the Franzens.
- Laundering money from these transactions and filed false personal income tax returns for the year 2010 on behalf of herself and her husband.
In January, the IRS executed search warrants at two banks in an attempt to collect more than $634,000 Laux supposedly misappropriated in her dealings with the Franzens. Court documents show, however, that they were only able to recover about $106,000.
Guenther’s daughter, Julie, and others sued Laux last year. That case is pending.
Prosecutors are also pursuing forfeiture of her home in Mequon and two of her businesses: Lasting Legacy LLC and Family Foundation LLC. They allege that Laux purchased the home and businesses with money from her scheme.
Her law license is currently active and in good standing, according to the State Bar’s website.Follow @eheisigWLJ