Lawyers Paul Marchese and Robin Maynard to repay $510G to a dead client's charitable trust



Two Manhasset lawyers reached a settlement with the state attorney general's office Wednesday to repay $510,000 to a dead client's charitable trust. 

Paul Marchese and Robin Maynard agreed to settle the lawsuit filed by New York Attorney General Letitia James' office last year in Nassau County Supreme Court. The lawsuit alleged the lawyers misappropriated $1.3 million from the charitable foundation to enrich themselves.

The attorney general’s office said Marchese helped Helen Gottlieb set up the Harold and Helen Gottlieb Foundation and charitable trust, worth about $2 million. He also was designated to act as a trustee upon her death.

She died in 2008 and Marchese was the sole administrator of the trust, redirecting nearly $600,000 in fees to his law firm, Marchese and Maynard, LLP., according to the attorney general’s office. They also paid themselves more than $750,000 in salaries from the foundation, James said in a statement.

As part of the settlement, the two lawyers were required to pay back $510,000 and may no longer operate as directors of a nonprofit corporation or a charity for three years, unless approved by the attorney general’s office.

“New Yorkers who generously donate to charity upon their death deserve to have their wishes honored,” James said in a statement. “Mr. Marchese and Ms. Maynard abused their positions and misused funds entrusted to them, depriving others of significant charitable donations intended to help the most vulnerable. My office will ensure that these funds will be used as intended and continue to enforce the laws that protect charitable organizations.”

In a statement Wednesday by Marchese & Maynard, the lawyers said all fees paid to the firm “were entirely appropriate and consistent with extensive legal work the firm performed.”

“For 24 years, we did legal work for Helen D. Gottlieb, for her living trust, for her estate and trust after her death, and for the Foundation she created — all without being paid,” the lawyers’ statement said. “We had a clear understanding with her that she would not pay us during her lifetime because her assets were largely illiquid, and that we would collect our fees from her trust after her death.”

They said they were unable to document the legal work, following a fire in their office and an old computer system. They also did not maintain pay sheets more than seven years old, they said.

The attorney general’s office said the lawyers’ salaries as directors of the foundation violated state law, which New York officials said grew larger than what the foundation disbursed in charitable grants.

The attorney general’s office said Marchese and Maynard admitted in the settlement to not registering the trust after Helen Gottlieb’s death. The settlement also notes failing to retain timely records of the trust’s expenditures, and operating the foundation without a legally constituted board of directors.

“As a result, they set their own compensation without review by nonconflicted directors,” state officials said. “They also failed to adopt and adhere to a conflict of interest policy.”

The lawyers agreed in the settlement to dissolve the foundation and its remaining assets, which combined with the $510,000 in restitution, total more than $1 million, officials said. The remaining funds will be disbursed to other charities supervised by the attorney general’s office.

By John Asbury

john.asbury@newsday.comJohnAsbury

John Asbury is a breaking news and general assignment reporter. He has been with Newsday since 2014 and previously worked at The Press-Enterprise in Riverside, California.