ELYRIA — Jailed Lorain tax consultant Richard Zakarian has been ordered to pay $1.4 million to Spitzer Management and 11 other former clients from whom he allegedly stole money.
Anthony Giardini, the attorney representing the alleged victims, said he does not yet know exactly how much each of his clients would receive under the order because they have yet to finalize their losses.
But it’s also possible that the pool of money from which the victims will be able to collect will be small. Giardini said he’s only been able to track down around $45,000 worth of Zakarian’s assets.
“We’re going to start the next process now, which is to find our money,” Giardini said.
Giardini and Lorain County Prosecutor Dennis Will have both said that Zakarian is suspected of stealing several million dollars from more than 100 clients. Giardini also has said that Zakarian may have lost much of that money speculating on the commodities market in Chicago.
Although Zakarian has pleaded not guilty to criminal charges leveled against him for stealing from Spitzer and a few other victims, he has not mounted a legal defense to several lawsuits accusing him of bilking his clients.
Zakarain wasn’t represented by an attorney at the brief hearing Tuesday during which Lorain County Magistrate James Blaszak ordered him to pay Giardini’s clients.
Although the full extent of Zakarian’s thefts hasn’t been revealed by investigators, court filings indicate he is accused of stealing at least $2 million.
Giardini said that federal investigators are now involved in the case, but Will declined to discuss the status of the investigation, except to say it was ongoing.
Court documents indicate that Zakarian allegedly used several schemes to defraud his clients, which included businesses, nonprofit organizations, individual investors and churches.
For instance, he allegedly told nonprofits and churches that they had been awarded a grant through a charity for free payroll and tax services in order to win their business for his company, Benjamin Franklin Payroll Service, which also was known as Benjamin Franklin Tax Service.
Once he got clients’ money, Zakarian was supposed to use it to pay taxes but allegedly pocketed much instead. Giardini has said that the clients wouldn’t have been aware their taxes weren’t paid until months, if not a year, later.
Spitzer was the first victim to discover the missing money — approximately $754,000 — and Giardini turned over his findings to Will’s office before filing a lawsuit against Zakarian in August.
Contact Brad Dicken at 329-7147 or firstname.lastname@example.org.