A Pennsylvania lawyer is drawing fire from prosecutors after his request that a portion of funds seized from his client, who pleaded guilty to a $10 million Ponzi scheme, be used to pay legal bills instead of being distributed to victims. George Heitczman, a Bethlehem, Pennsylvania lawyer, served as counsel to Richard A. Freer, who pleaded guilty to 181 counts of theft on charges he operated a Ponzi scheme that duped victims out of at least $10 million. Freer was sentenced last month to serve at least 12 years in prison.
During the investigation that ultimately led to Freer's arrest, authorities seized approximately $54,430. While Freer's prison sentence also included an order that he pay $7.5 million in restitution to his victims, the funds seized by authorities are widely thought to represent all that was left of Freer's scheme.
In a filing with the court, Heitczman proposed that Judge Jennifer Sletvold award him $20,480 - or approximately 40% of the money seized from authorities by Freer - for repayment of Heitczman's legal fees incurred in representing Freer. According to Heitczman,
My thought is, I'd like to get paid for my services. At this point, it is his money. They haven't moved to forfeit it or anything else. If it's my client's money...he can spend it anyway he wants.
That proposal did not sit well with prosecutors, who have openly indicated their opposition. That skepticism appeared to be shared by Judge Sletvold, whose order scheduling a hearing on Heitczman's request included an instruction that prosecutors notify each of Freer's victims so that they may be able to attend the hearing.
Additionally, Judge Sletvold's order included a series of questions posed to Heitczman, including whether Freer's contract for legal representation entitles Heitczman to funds that are criminal proceeds, as well as whether allowing the payment of the legal fees will not affect Freer's ability to pay restitution to victims. According to Assistant District Attorney William Blake, ""I can almost guarantee you [that victims'] reaction is going to be anger, outrage [and] shock."
The hearing on Heitczman's request is scheduled for next week.