NYC Lawyer Charged In Kidnapping, Fraud Scheme

STATEN ISLAND, NY — Federal prosecutors in Brooklyn charged a controversial Staten Island lawyer and three other men Friday in a fraud scheme in which they held a co-conspirator at gunpoint. Richard Luthmann, 38, could face life in prison for his alleged involvement in a conspiracy that earned him and others more than half a million dollars, prosecutors said.

Luthmann, along with George Padula III, Michael Beck and Stephen Cotogno, scammed companies by selling them cheap "filler material" as scrap metal and deposited their profits in bank accounts opened by a blind man, prosecutors said.

Padula and Beck also held another unnamed man at gunpoint in Luthmann's law office to get him to pay off a debt, prosecutors alleged.

“As alleged, Richard Luthmann crossed the line from attorney to violent criminal and fraudster,” Bridget M. Rohde, the acting U.S. attorney in Brooklyn, said in a statement.

Luthmann, a prominent tax and estate lawyer who ran as a Democrat for Staten Island borough president in 2013, drew fire this summer for creating fake Facebook pages for various New York City and state political candidates, as a NY1 investigation revealed. Luthmann neither admitted nor denied created the pages but also didn't disavow them.

Prosecutors say Luthmann, Padula and an unnamed co-conspirator launched the scrap metal scheme in the summer of 2015. Padula, also of Staten Island, got involved because he has relatives in an organized crime family, prosecutors said.

Cotogno rented a warehouse he owned to the three men and helped them get ahold of cheap filler material that their clients thought was scrap metal, prosecutors allege.

Luthmann recruited the blind man, one of his law clients who lives on public assistance, to serve as the nominal president of a sham company involved in the scam, prosecutors say. Luthmann got the man to open a bank account in his name, into which the trio wired more than $500,000 in ill-gotten profits and later distributed amongst themselves, according to prosecutors.

A year later, on Dec. 5, 2016, Padula and Beck held the unnamed co-conspirator in Luthmann's law office, pointing a gun at his head and knee and demanding that he pay a $10,000 debt he owed Beck, prosecutors say. Padula and Luthmann previously told the kidnapping victim that Beck was tied to Padula's organized crime family, prosecutors said.

Luthmann and Padula were both charged with nine crimes including kidnapping, extortionate collection of credit and conspiracy to commit wire fraud, among others. Luthmann also faces charges of access device fraud and an additional count of aggravated identity theft.

Beck faces four charges related to the kidnapping and extortion. Cotogno was charged with wire fraud conspiracy for his role in the scrap metal scheme. All men face life in prison if convicted except Cotogno, who could get 20 years in prison.

(Lead image: Richard Luthmann at a 2015 Election Party via Nicholas Rizzi/Patch)