Disbarred legal heavyweight Tom Girardi convicted of fraud over 10-year Ponzi scheme

By FRED SHUSTER

Former high-powered litigator Tom Girardi was convicted Tuesday of running a massive 10-year Ponzi scheme in which prosecutors said he siphoned at least $15 million in settlement funds from four of his clients.

Jurors convicted the 85-year-old Girardi of four counts of wire fraud for stealing from injured clients and spending money on private jets, golf club memberships, jewelry and the career of his now-estranged wife, “Real Housewives of Beverly Hills” star Erika Jayne.

The jury began deliberating Monday afternoon following closing arguments, and deliberated for about two hours Tuesday morning before announcing that a verdict had been reached.

Girardi showed no visible reaction as the verdicts were read. Girardi suffers from dementia but was deemed able to assist in his own defense during the trial, and he even testified.

During closing arguments Monday. Assistant U.S. Attorney Ali Moghaddas told the jury that Girardi “wanted the outside world to believe he was fighting for people who couldn’t help themselves,” but instead, clients who were expecting settlement funds waited as “days turned into months and months turned into years.”

Charles Snyder, a deputy federal public defender who is representing the defendant, told the jury that as his client’s cognitive impairment worsened over the years, employees of the defendant’s now-closed Girardi Keese law firm — not Girardi — were stealing funds “hand over fist.”

“Girardi was not paying close attention” to the operation of his firm, Snyder said, saying his client “got old, got sick, and lost his mind.”

Prosecutors said the fraud scheme lasted from 2010 to 2020 and involved many more ex-clients than the four involved in the current case.

The four wire fraud counts corresponded to four victims whose settlement funds were allegedly pilfered by the disgraced ex-attorney. They are: Joe Ruigomez, who suffered burns on most of his body when a gas line exploded, killing his girlfriend; Judy Selberg, whose husband was killed in a boating calamity; Josefina Hernandez, who was injured by a faulty medical device; and Erika Saldana, whose one-year old baby was badly injured in a car crash with a drunk driver. The baby later died.

Last Thursday, Girardi was the final witness called by his lawyers to testify, claiming “every client got every penny that every client was supposed to get.”

The defendant blamed his firm’s former chief accountant, Chris Kamon, for the missing money. From the witness stand, Girardi said Kamon “was pretty clever in stealing millions of dollars.”

Kamon, 50, is scheduled to stand trial separately in January on wire fraud charges, accused of pocketing about $50 million from Girardi Keese accounts.

Assistant U.S. Attorney Scott Paetty told jurors in his rebuttal argument Monday that Kamon will soon face his day in court. At the same time, he said, just because the former accountant allegedly siphoned settlement funds, it doesn’t make Girardi innocent.

“It just makes Girardi Keese a den of thieves, and it makes Girardi the thief-in-chief,” Paetty said.

Snyder told the jury in L.A. federal court in his closing that while Girardi became an increasingly confused “bad manager” of the firm, Kamon was operating as a “virtuoso” of fraud.

However, Moghaddas said it was Girardi who treated attorney-client trust accounts as “his personal piggy bank,” adding that some clients never saw anything of their settlements.

Earlier this year, after several days of hearings, Girardi was found competent to stand trial despite his claim that he has Alzheimer’s disease and is incapable of assisting his lawyers. He is free on $250,000 bond and lives in the secure memory ward of an Orange County nursing home.

Once known as a defender of the powerless in class-action lawsuits against corporations, Girardi represented plaintiffs in a number of high-profile cases, including Bryan Stow’s civil suit against Major League Baseball. Stow was the San Francisco Giants fan who sustained severe injuries during an attack in a Dodger Stadium parking lot.

Girardi also represented plaintiffs in the toxic groundwater case against Pacific Gas & Electric Co. that was dramatized in the Oscar-winning 2000 Julia Roberts movie “Erin Brockovich.”

Jayne filed for divorce from Girardi in 2020 after a 21-year marriage. Following the split, the couple listed their Pasadena home for sale at a price of $13 million. Jayne has not been charged in the case against her husband.

After Girardi was disbarred in 2022, the State Bar of California reported it had received 205 complaints against him alleging he misappropriated settlement money, abandoned clients or committed other serious ethical violations over the course of his four-decade career.

Girardi Keese collapsed in late 2020 after Girardi was accused in a Chicago lawsuit of embezzling money meant for clients the firm was representing in litigation over an airplane crash in Indonesia. The lawsuit brought by plaintiffs’ firm Edelson PC has since been transferred to Los Angeles.

Girardi is in Chapter 7 bankruptcy proceedings, as is the now-shuttered Wilshire Boulevard law firm that bore his name and that faces more than $500 million in claims.