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Between Nov. 1 and Nov. 8, Kwasnik allegedly disbursed over $270,000 of the transferred funds from the new bank account to pay expenses of the law firm, as well as more than $12,000 in personal expenses and credit card debt. It is further alleged that on Nov. 7, after being notified of the prior indictment and while allegedly traveling in Florida to evade prosecution, Kwasnik withdrew $8,000 in cash from the account.

Investigators had the bank account frozen after Kwasnik was arrested in Dothan, Ala. on Nov. 9 on a warrant obtained by the Division of Criminal Justice. At the time of his arrest, blank checks for the bank account were found in his possession.

In the prior indictment, the 96-year-old client from Cherry Hill hired Kwasnik for estate planning purposes. Kwasnik set up a family trust for the client and her children, and was also hired to help the client administer the estate of her deceased sister.

In 2006, Kwasnik received checks from the estate totaling about $1.1 million, which he deposited into the general trust account for clients maintained by his law firm. However, rather than holding or investing the funds as assets of the client’s family trust, he allegedly withdrew the funds, stealing over $1 million. He allegedly misappropriated the funds for his own benefit and other purposes unrelated to the administration of the estate, including paying other clients and paying the operating expenses of his law firm.

At that time, Kwasnik was managing partner of the law firm of Kwasnik, Rodio, Kanowitz and Buckley. In that case, Kwasnik is also charged with theft by failure to make required disposition of property received, misapplication of entrusted property, and money laundering, all in the second degree.

The criminal cases were investigated by Deputy Attorneys General Denise Grugan, and Peter Gallagher and Sgt. James Blong of the Division of Criminal Justice under the supervision of the bureau’s chief and deputy chief, Supervising Deputy Attorney General Terrence Hull and Deputy Attorney General Francine S. Ehrenberg.

Second-degree crimes carry a maximum sentence of 10 years in state prison and a fine of $150,000. Second-degree money laundering carries an enhanced fine of up to $500,000, plus an additional anti-money laundering profiteering penalty of $250,000.

The new indictment was handed up to Judge Sumners Jr. in Trenton, who assigned the case to Camden County.

On Nov. 7, the day the first indictment was unsealed, Kwasnik was named as a defendant in a pending civil lawsuit which had been filed in March by the state Bureau of Securities, against two corporate defendants linked to Kwasnik, Liberty State Financial Holdings Corp. and Liberty State Benefits of Pennsylvania Inc.

The new charges in the civil suit alleged that Kwasnik, his father, William Kwasnik, and other individuals engaged in a fraudulent scheme in which about $8.5 million was raised from 73 investors, most of them elderly and retired, by selling unregistered securities, on which they promised an annual return of 12 percent.

It is alleged that rather than investor funds being invested as promised, they were misused, at the purported direction of William Kwasnik, including the improper transfer of approximately $5 million to Michael Kwasnik's law firm, and to Michael Kwasnik, William Kwasnik and other relatives for their personal benefit.

—TOM HESTER SR., NEWJERSEYNEWSROOM.COM