The SEC charged the former financial advisor Kenneth Ira Starr, Jonathan Star Bristol, with aiding and abetting Starr’s multi-million dollar fraud by allowing Starr to use his attorney trust accounts as conduits for money Starr stole from his clients.
The SEC claims that over $25 million of Starr’s clients’ money came through Bristol’s trust accounts. Starr would transfer client funds into the attorney trust account, and Bristol would transfer the stolen funds to Starr for personal use.
Account statements listing the names of Starr’s clients as the source of the incoming transfers were sent directly to Bristol’s home address instead of his law firm.
The SEC claims that Bristol crossed the line from lawyer to conspirator when he failed to safeguard funds entrusted to him and helped Starr steal client funds.
Bristol was confronted by one of Starr’s victims about an unauthorized $1 million transfer from the victim’s account. Bristol lied to the victim that the funds were being bundled with other clients’ funds for an investment with UBS Financial Services. Bristol had already used the misappropriated funds to pay a multi-million dollar legal settlement with one of Starr’s former clients.
Bristol then sought to represent that victim after he was contacted by SEC staff in its investigation. This raised ethical conflicts of interest beyond the civil liability and possible criminal charges that Bristol could face.