Woodbridge Attorney Stole Millions From Clients: U.S. Attorney

WOODBRIDGE, CT — Bankruptcy attorney Peter Ressler, 70, of Woodbridge pleaded guilty to stealing millions from his clients.

Ressler used retainer fees and deposits meant for trusts for his own expenses, according to the U.S. Attorney District of Connecticut. He worked on Chapters 7, 11 and 13 bankruptcy cases involving individuals and businesses.

In total he misappropriated at least $3.4 million in client funds which he used for his personal benefit, to cover expenses of his practice and to fund payouts to other bankruptcy estates from which he improperly took money.

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As part of both Chapter 11 and Chapter 13 filings, Ressler submitted multiple documents to the bankruptcy court that represented the status of a debtor’s assets and liquidity, including the debtor-in-possession monthly operating reports. In various instances, Ressler had already improperly dissipated a portion of a client/debtor’s assets and knew that operating reports filed for certain clients contained false representations, which misled both the bankruptcy court and creditors as to a debtor’s true financial condition. When asked directly in hearings as to whether certain assets existed in certain accounts, Resslerfalsely represented that certain assets existed, when he knew that they did not.

Ressler also engaged in “work outs” where he would attempt to settle a client’s debts with creditors without relying on the protections of bankruptcy. As part of this process, Resslerrequested that his clients deposit with him funds and represented that he would hold the funds in trust and then use them to settle disagreements with financial institutions or other creditors, such as the IRS, or for some other purpose on behalf of his clients. The investigation revealed that Ressler took $64,000 from a client purportedly to purchase property; $180,000 from a client to hold money in escrow; $45,000 from another client purportedly to buy back a home in foreclosure; $100,000 from a client to hold money in escrow; $97,000 from a client to hold money in escrow; $102,000 and $50,000 from two other clients purportedly to settle tax obligations with the IRS; at least $199,000 from a client to negotiate a settlement with the IRS; $141,000 from a client to settle debts with IRS and a lender; and $165,000 from a client purportedly to negotiate a loan modification with a lender. In each instance, Ressler used the monies for other purposes.

In the spring of 2016, the U.S. bankruptcy court identified criminal conduct by Ressler in cases involving debtors that were his clients. In one case, the debtor entrusted Ressler with $450,000, which were proceeds of a legal settlement, to be held by Ressler’s firm for the benefit of the debtor and its creditors. In a second case, the debtor entrusted Ressler’s firm with approximately $321,409. In both cases, most of the deposited funds were used by Ressler for other purposes than on behalf of the relevant clients.

In total, Ressler misappropriated at least $3.4 million in client funds and used the money for personal and family living expenses, to cover the expenses of his practice, and to fund payments relating to other clients and other bankruptcy estates from which he had previously improperly taken monies.

Ressler pleaded guilty to one count of wire fraud, two counts of embezzlement from a bankruptcy estate, and one count of bankruptcy fraud. Judge Covello scheduled sentencing for September 6, 2017, at which time Ressler faces a maximum term of imprisonment of 35 years and a fine of up to approximately $6.8 million.

Ressler has been released on a $100,000 bond since his arrest on April 25, 2016. He resigned from the Connecticut bar in March 2016.

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