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Foreign Trusts Allege N.Y. Lawyer 'Shamelessly Looted' Millions From Bank Accounts
The National Law Journal
April 14, 2009
The owners of five Liechtenstein-based trusts have sued a New York lawyer with 60 years experience in international estate planning, alleging he "shamelessly looted" more than $15 million from the clients for longer than a decade.
Winthrop Ross Munyan, most recently associated with a small Rye, N.Y.-based trusts and estates firm, Riad & Associates, was accused of fraud, unjust enrichment, conversion and breach of fiduciary duty in a state court suit filed on April 9. It alleged he embezzled millions of dollars from the offshore companies between 1997 and 2007.
Munyan left the Riad firm in 2008, according to Maged Riad, the managing partner.
"He has no relations with the firm, Riad said. "He was acting as trustee for the foreign trusts for 30 or 40 years. I thought I saw something improper, and I called the trustees and brought it to their attention," Riad said. "That was his [Munyan's] last day with the firm," he said.
Named in the suit along with Munyan are Riad & Associates; Dr. Peter Ritter; Dr. Guido Meier; Peter Meyer; Pictet & Cie, a private bank in Geneva; and Kinbrace Corp., a Liberian flow-through entity allegedly operated on behalf of Munyan by Ritter.
Munyan could not be reached for comment. None of the other named defendants could be reached for comment.
Riad said he has not yet seen the lawsuit but denies all allegations related to him and the firm.
Michael S. Feldberg of Allen & Overy in New York represents the plaintiffs. He alleged that Munyan "looted" money from the bank accounts he was meant to manage "all while living the high life ... often flying on the Concorde and maintaining an apartment in Paris and hotel suites in London."
"It is unclear whether Munyan planned his scheme from the outset or if he slithered into it as the opportunity arise," Feldberg wrote in the complaint.
The suit alleges that funds were embezzled between January 1997 and December 2007. The five plaintiffs, Establishment Finapart, Establishment Figest, Establishment Gour-Sande, Establishment Elatia and Establishment Elatia, accuse Munyan of "using a Byzantine system of trusts and offshore companies for his own personal use." It alleges he diverted assets from the five Liechtenstein trusts to make payments to Riad's accounts and to pay Kinbrace for his personal use, and that he diverted plaintiffs' funds to pay his American Express accounts.
In Establishment Finapart v. Munyan, No. 0960110 (New York Co., N.Y., Sup. Ct.), Feldberg alleges that Ritter and Meier were directors on the trusts' board of directors and had an obligation to prepare annual financial statements. Instead, "Ritter and Meier gave Munyan the keys to the establishments and, by extension, the assets they controlled, and turned a blind eye as Munyan drained the establishments' coffers."
Ritter is described as co-founder of a Liechtenstein wealth management company, Kaiser Ritter Partner Holding, and Meier as a Liechtenstein lawyer.
The suit states that Munyan resigned as trust protector in December 2007. In addition, it alleges that Maged Riad contacted a lawyer for the trust beneficiaries in March 2008 to provide a list of documents in Riad's possession related to the trusts. "Maged Riad subsequently offered to make those documents available subject to an exorbitant fee," the suit states.
