New York officials are recovering $6.3 million stolen from charities

Attorney General Letitia James helped recover $6.3 million stolen from family trusts by former attorney Richard J. Sherwood and financial advisor Thomas K. Lagan. Photo: Bebeto Matthews/AP

Attorney General Letitia James and U.S. Attorney Carla Freedman on Wednesday announced the recovery of $6.3 million stolen by former attorney Richard J. Sherwood and financial advisor Thomas K. Lagan.

The duo exploited their role as administrators of the estates of three older sisters from Guilderland, New York, and embezzled approximately $11.8 million intended for charitable causes throughout the Capital Region.

Sherwood and Lagan, both convicted of grand larceny in 2019, manipulated the estate planning and trusts of philanthropists Warren and Pauline Bruggeman and Pauline’s sister, Anne Urban. They sent the sisters’ assets to a sham trust, Empire Capital Trust, which they had set up, making themselves the beneficiaries.

This fraudulent activity continued until Anne’s death, at which point they accelerated their theft and transferred large sums of money to themselves rather than to the charitable organizations specified in the original estate plans.

“New Yorkers should be able to trust that their financial advisors and attorneys will represent their best interests – not steal their hard-earned money,” said Attorney General James. “Sherwood and Lagan defrauded a well-intentioned family, defrauding local nonprofits of funds intended to support their missions. Thank you to U.S. Attorney Freedman for her partnership in rooting out fraud and stopping those who abuse the system.”

This recovery comes from the joint efforts of state and federal law enforcement and legal agencies, with the recovered funds now to be distributed to the original intended recipients, including St. Nicholas Ukrainian Catholic Church, the Ukrainian American Cultural Center and the Ellis Hospital Foundation. and the Bruggeman ’46 Scholarship Fund from Rensselaer Polytechnic Institute.

The U.S. Attorney’s Office continues to work to recover the remainder of the stolen funds to pay restitution owed to the affected parties.