A suspended Las Vegas attorney accused of stealing hundreds of thousands of dollars from his clients pleaded guilty Monday in the high-profile federal investigation into the scheme to take over valley homeowners associations.
Barry Levinson, 47, who has more Nevada bar complaints against him than any other lawyer, also pleaded guilty to trying to evade $28,211 taxes from the Internal Revenue Service and embezzling more than $243,000 from his clients.
U.S. District Judge James Mahan set a May 5 sentencing.
Levinson’s plea was part of an agreement Levinson and his lawyer Brent Bryson struck with federal and Clark County prosecutors to resolve all of his criminal charges. He also is expected to plead guilty in District Court to the theft of more than $1 million from his clients.
As part of his federal plea deal, Levinson agreed to disbarment and will pay as much as $271,646 in restitution to the IRS and his clients.
Charles La Bella, a deputy chief of the Justice Department’s Washington-based Fraud Section, told Mahan he would argue at sentencing for nothing less than two years in prison for Levinson. Any prison time for the state theft charges will run concurrently to the federal time, according to Levinson’s agreement with prosecutors.
Levinson, who declined comment afterward, also has agreed to cooperate with federal prosecutors in the HOA case and investigators with the State Bar
He was indicted by a federal grand jury last year on conspiracy and fraud charges with Leon Benzer, the accused mastermind of the HOA takeover scheme, and nine other defendants. Levinson is the first of those defendants to plead guilty.
The sweeping investigation is thought to be the largest public corruption case federal authorities have brought in Southern Nevada. A total of 30 other defendants have pleaded guilty in the scheme, which occurred between 2003 and 2009.
Benzer and his co-conspirators rigged elections to pack HOA boards with members who handed out legal and construction defect contracts worth millions of dollars to them at the expense of the homeowners, according to federal prosecutors.
Levinson pleaded guilty Monday to a felony charge of conspiracy to commit wire and mail fraud in the HOA scheme.
According to his plea agreement, he admitted that even though he represented one of the scheme’s HOA victims, Park Avenue, he treated Benzer as his client and used bribery to uphold a rigged board election.
Levinson admitted that he tried to stall a recall election at another HOA, Pebble Creek, even filing a lawsuit to keep Benzer’s people on the board. That effort failed.
Levinson also pleaded guilty to a felony charge of attempting to evade the $28,211 from the IRS by filing a false return for the 2011 tax year. He admitted that he owed the IRS money from the tax years 2009 through 2011.
Between March 2010 and September 2011, Levinson misappropriated the more than $243,000 in client funds, mostly obtained from personal injury settlements, his plea agreement stated. He pleaded guilty to a felony wire fraud charge in that scheme.
Levinson’s license to practice law was temporarily suspended in September 2012 amid a separate investigation by the State Bar of Nevada into allegations he misappropriated client funds.
The district attorney’s office charged him in the $1 million theft last month. At the time, State Bar Counsel David Clark said his organization, which regulates lawyers, had received 128 grievances against Levinson, the most of any Nevada lawyer.
Levinson was accused in a criminal complaint of stealing the $1 million from personal injury settlements between January 2007 and July 2012. He is facing four felony theft counts.
In a report on the theft investigation, Robert Whiteley, a detective with the Criminal Intelligence Section of the Metropolitan Police Department, said Levinson used deceit to “string” along his clients.
“Levinson engaged in a Ponzi scheme in the sense that he would use money from current clients to pay partial settlements of previous clients,” wrote Whiteley, who also is involved in the HOA investigation. “In most cases, the clients never received any of the settlement money.”
In its September 2012 suspension order, the Nevada Supreme Court said the evidence it received from the State Bar demonstrated that Levinson posed a “substantial threat of serious harm to the public.”
This is a developing story. Check back for updates.