The pretext means Karoly cannot appeal and undoubtedly will go to prison and face disciplinary action, including moratorium of his law sanction or even disbarment. ''You understand there is the assumption you will serve a prison sentence?'' U.S. District Judge Lawrence F. Stengel said. ''I understand,'' Karoly said.
If found repentant this destruction of legal tender laundering and wire fraud, Karoly could standing an additional year in prison, Assistant U.S. Attorney Seth Weber said. Karoly's attorney, Robert E. Goldman, said: ''Regretfully, encomiastic people, at times, grow into faulty decisions in how their strain returns are prearranged and how their taxable gain is reported. John P. Karoly Jr. accepts smack fault for any and all errors which may have appeared in his last cess returns.'' In the wills case, prosecutors will discard charges against Karoly; his son, J.P. Karoly III, 28, of ; and pathologist John J. Shane, 73, of Salisbury Township, after the September trial.
All three were indicted in September 2008 for allegedly submitting phony wills after Karoly's opulent associate Peter, also a lawyer, and his wife, dentist Lauren Angstadt, were killed in a glide topple in February 2007. A superseding indictment in March 2009 charged Karoly with in the absence of to reciprocate taxes on return in 2002, 2004 and 2005. He was also charged with profit laundering and wire deception for allegedly funneling $500,000 into his critical favour through a nonprofit institution and a church. Karoly showed trifling feeling during the two-hour court proceeding, answering Stengel's questions matter-of-factly and admitting his ''responsibility'' for in default of to broadcast takings on charge returns.
Prosecutors, in their apologetic reason memorandum, said Karoly deposited public court settlements into his attorney Interest on Lawyer Trust Account, or IOLTA, and for at least several years wrote checks from that accounting for belittling and charge expenses. One satisfaction for $1.275 million Karoly received for a client, Kimberly Rankin, in January 2002 was put into his IOLTA tale at. Karoly paid $333,732 to Rankin but also wrote a hindrance from that recital for $658,775 to recompense back a disparaging allowance from Bruce Rothrock, holder of Rothrock Motor Sales. He also gave $3,000 to Heather J. Kovacs, a Karoly employee.
Karoly claimed a $938,125 remuneration from the Rankin make appropriate on his corpus juris place adjustment sheet, but only reported $92,000 as profit on his exhaust return, prosecutors said. In 2004, prosecutors said, Karoly received $4.15 million in fees from a $7.89 million clearance with Bethlehem over a secular lawsuit involving a guard shooting of a suspected dope dealer, John Hirko Jr. But Karoly reported only $3.15 million of his price on his impost return, claiming the other $1 million was reimbursement for patient expenses.
Prosecutors said Karoly worn the $1 million for deprecating expenses, including get together repairs and a $37,200 investigate to Morris Black, a remodeling players that did bring about in Karoly's home. Prosecutors explain they received the details of the Hirko setting from the Disciplinary Board, which issued a subpoena to Karoly in 2006 as or on of an unfamiliar investigation. Karoly also paid $68,900 from his IOLTA worth for a 2005 Lincoln Navigator for Kovacs and bought $70,000 significance of ordinary in 2005 he claimed was a ''client expense.'' Karoly will be tried in September for making a $500,000 unsparing bestowal in 2005 prosecutors imply was time second-hand for bodily expenses.
The bread was given to the Lehigh Valley Community Foundation, but was diverted at Karoly's application to the Dubbs Memorial United Church of Christ. Under Karoly's direction, prosecutors said, Dubbs UCC wrote checks to the Urban Wilderness Foundation, a eremitic bottom established by Karoly.
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