Victims who said they were swindled by attorney Anthony Lupas Jr. won’t be at a complete loss with the pending dismissal of his criminal charges.
Many of them received compensation through the Pennsylvania Lawyers Fund for Client Security, set up to reimburse people who lost money due to misappropriation by their attorneys.
The latest operations report of the fund listed $2.23 million was paid to 34 people who filed claims against Lupas between July 1, 2012 and June 30, 2013. The payout was 64.5 percent of the total $3.46 million awarded during that period.
U.S. Attorney Peter J. Smith cited the deteriorating mental condition of 80-year-old Lupas in a motion filed Monday to dismiss the superseding indictment against the former Wilkes-Barre Area School District solicitor and private attorney.
The dismissal would affect civil proceedings as well, said attorney Ernie Preate Jr. of Scranton. He represented a number of people who invested with Lupas.
“That’s one of the reasons we decided to go the route of the client security fund to reimburse for our losses,” Preate said Tuesday.
“We realized fairly early on that he was not going to be determined to be fit to proceed,” Preate said.
The investors had minimal documentation and many of the agreements were made orally rather than in writing, he explained. They provided what they could to the fund whose representatives made a payment determination after corroborating information provided by attorneys for Lupas.
The fund made “substantial” six-figure awards, Preate said. The fund pays a maximum of $100,000.
A grand jury in July 2012 indicted Lupas on charges of mail fraud and conspiracy. Federal prosecutors said he bilked clients out of more than $6 million over an 18-year period in a scheme that promised a 5 percent to 7 percent return on their investments.
Smith said in the filing that following review of the case by multiple mental health experts, there is “no substantial probability that his competency will be restored in the foreseeable future.”
Lupas, who pleaded not guilty to the charges, has been held in the mental health unit of the Bureau of Prisons Federal Correctional Center at Butner, North Carolina.
Co-defense attorney Joseph Blazosek of West Pittston said he concurred with the prosecution’s motion. The federal government has the right at some point in the future to take another look at everything to see if Lupas’ condition improves, Blazosek said.
Pending the dismissal, Lupas will be returned to the region for care, Blazosek said.