A local attorney who allegedly embezzled hundreds of thousands of dollars from relatives with disabilities, and also millions from companies, has agreed to plead guilty.
Lexington lawyer David Smerling, 75, was charged by the feds in connection with alleged schemes to defraud Massachusetts victims, including two of his own relatives.
Smerling was previously indicted in January on charges of embezzling from a business partner.
“The alleged multi-million-dollar embezzlement that Mr. Smerling was originally charged with was, unfortunately, just the tip of the iceberg,” Massachusetts U.S. Attorney Leah Foley said.
“Today’s charges allege that Mr. Smerling also preyed on a family member with special needs and another with dementia, allegedly stealing money these victims needed for their own care,” Foley added.
Smerling allegedly embezzled more than $2.5 million from three companies where he worked as a bookkeeper.
He’s accused of transferring funds from the victim companies into a separate bank account that he controlled, before moving the money to bank accounts in his own name, or directly from the companies’ accounts to bank accounts in his own name.
Smerling allegedly concealed his scheme by changing the mailing address on victims’ bank statements to his home address, and refusing to share the online banking password for the victims’ accounts.
Then, Smerling allegedly embezzled more than $470,000 from a trust established for the benefit of a relative with special needs, for which Smerling served as the trustee.
Smerling allegedly transferred trust funds to bank accounts he controlled before sending the funds to bank accounts in his wife’s name, or using the funds to pay for personal expenses. Smerling concealed his scheme by making lulling payments to the beneficiary, so he would not discover the trust had been depleted.
He also allegedly embezzled more than $150,000 from a relative with dementia, for whom Smerling served as the financial power of attorney. Smerling allegedly transferred funds from the victim’s accounts to accounts he controlled, used a credit card in the victim’s name for personal purchases, and took out a loan in the victim’s name.
To conceal this scheme, Smerling allegedly misrepresented the purpose of the transfers to the financial institutions in which the victim’s accounts were held.
“For anyone with elderly and vulnerable loved ones, these are frightening allegations,” said Kimberly Milka, acting special agent in charge of the FBI Boston division. “David Smerling allegedly betrayed the trust of his victims and took full advantage – embezzling from them to line his own pockets while trying to cover up his crimes. The FBI will never stop working to protect the public from criminals like this, and we’re gratified to see him brought to justice.”
Smerling has agreed to plead guilty to four counts of wire fraud, two counts of money laundering and one count of aggravated identity theft.