(CN) - A Kansas attorney pleaded guilty to stealing more than $460,000 from client trust funds in a Ponzi scheme, federal prosecutors said.
Robert Telthorst, 52, of Topeka, pleaded guilty Wednesday to one count of wire fraud and one count of money laundering in U.S. District Court.
He admitted that, from November 2005 to August 2011, he took the money for himself and to cover up that he was taking money from other clients' trust accounts.
Prosecutors identified two defrauded clients as the daughters of "Otto K."
"After the man's death, Telthorst was appointed to administer $463,344 for the man's two daughters," prosecutors said in a statement. "The man wanted the first daughter, identified as Sheri T., to receive a lump sum. Money for the second daughter, identified as Marlene O., was to be invested, with monthly payments to be made to her. Before providing the lump sum to Sheri T., Telthorst took approximately $22,000 for his own benefit. In the trust for Marlene O, the balance dropped from more than $208,500 to less than $150 after Telthorst removed most of the funds for his own benefit."
Telthorst also stole from granddaughters of another client, prosecutors said.
"Telthorst set up three educational gift trusts of $10,000 each," according to their statement. "He depleted all three trusts, leaving them each with balances of less than $350."
Two other clients established a charitable trust of $80,000 for the University of Kansas School of Business, and Telhorst drained their account down to less than $1,750.
Sentencing is scheduled for Feb. 19, 2013. As part of his plea agreement, both sides recommend a sentence of five years in federal prison and more than $460,000 in restitution.
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