05/09/08

TITLE: Eatontown Lawyer Sentenced to Seven Years in Prison for Stealing $1 Million from His Former Employer, K. Hovnanian
DESCRIPTION:
Time: 09:04:01

ARTICLE

Attorney General Anne Milgram and Criminal Justice Director Gregory A. Paw announced that an Eatontown man was sentenced to prison today for stealing $1 million from K. Hovnanian while employed as an in-house attorney for the company.

According to Director Paw, Scott R. Baron, 50, of Eatontown, was sentenced to seven years in state prison by Superior Court Judge Bette E. Uhrmacher in Monmouth County. Baron was sentenced for the K. Hovnanian theft, as well as two other thefts that occurred after he was laid off by K. Hovanian. In each case, Baron gambled away the stolen funds. Baron was required to enter a consent judgment to pay a total of $1,377,621 in restitution to the victims. He previously was required to permanently give up his right to practice law in New Jersey.

For the K. Hovnanian theft, Baron pleaded guilty on Jan. 25, 2008 to an accusation charging him with second-degree theft by failure to make required disposition of property received. He admitted that between April 5, 2005 and March 23, 2007, he stole $1 million in funds that he received as in-house counsel for K. Hovnanian. Baron was responsible for canceling contracts the company had entered for certain real estate purchases and recovering deposits made by the company with numerous escrow agents and other entities. Baron admitted that he received checks totaling $1 million and deposited them in his own account, without telling his employer of the refunds.

On April 1, 2008, he admitted the other thefts, pleading guilty to an accusation charging him with theft by failure to make required disposition of property received and theft by deception, both in the second degree. In connection with the first of those charges, Baron admitted that in October 2007, he stole $190,259 in funds related to two real estate transactions. In each transaction, Baron was settlement agent for the purchaser and failed to disburse funds that were wired to his account for payment of various taxes and fees. In connection with the theft by deception charge, Baron admitted that he refinanced his home in October 2007 without telling his wife, even though title to the home was in her name. He deceived the lender by presenting documents that he fraudulently claimed were signed by his wife. Baron received $145,584 from the loan. In both cases, Baron used the stolen funds to support his gambling addiction.

Lt. James MacInnes investigated the case for the Division of Criminal Justice – Major Crimes Bureau. Supervising Deputy Attorney General Terrence Hull prosecuted the case.