Citibank Sued Over Art Buchwald’s Estate

     WASHINGTON (CN) – Art Buchwald’s son claims in court that Citibank let Kenneth I. Starr’s investment firm raid a home equity line of credit taken from the late Washington Post columnist’s Martha’s Vineyard property.
     Joel Buchwald sued Citibank in Superior Court for negligence, claiming the bank allowed Starr to dupe his dying father into signing a power of attorney, which Starr used to pull the equity out of Buchwald’s summer home.
     Buchwald claims that in the 1980s his father retained the firms of Starr and Company and Starr Investment Advisors, which managed finances for several celebrities and entertainers, to provide financial advisory and other financial services.
     Citibank is the only defendant in this complaint.
     Art Buchwald suffered a stroke in 2000 that was followed by years of health problems. In 2005 his failing kidneys required him to go on dialysis and an embolism led to the amputation of his leg.
     “The decline in Buchwald’s health was a matter of public record. This was due in part to his celebrity. But it was also due to the fact that Buchwald chose to directly and publicly confront his own mortality by incorporating it as a central theme of his writings and media appearances,” his son says in the complaint. “He confronted his impending death as he had addressed other matters – everything from the most mundane aspects of everyday life to the great issues of our time – with his unique insight and humor.”
     Joel Buchwald claims Starr and his employees took advantage of his father’s rapidly declining health by tricking him into signing over a power of attorney to one of Starr’s employees.
     “Their plan was to cause Buchwald to obtain a home equity line of credit (HELOC) secured by the Martha’s Vineyard property, and to embezzle funds that would later be advanced by lender,” the complaint states.
     Buchwald claims that Starr used his father’s “illegible” signature, which “should have raised suspicion,” to secure a loan from Citibank. Buchwald claims the bank had approved the loan before Starr’s office got the power of attorney.
     “The creation of the power of attorney was, in effect, an attempt to retroactively authorize the creation of an account that was originated without any authority,” the complaint states. “Because of the very unusual circumstances in which the power of attorney was effected, it should have been subject to a particularly high level of scrutiny.”
     Buchwald claims Citibank paid a $50,000 advance on the line of credit, but the estate never saw any of the money. He says Citibank paid out another $50,000 on the line of credit two days after Buchwald died in 2007.
     “After his appointment as executor, plaintiff investigated Buchwald’s various financial transactions involving Starr, both those occurring prior to Buchwald’s death, as well as the transactions of the estate that had occurred during the supervision of that estate by Starr,” the complaint states. “Prior to the public revelation in 2010 of the Ponzi scheme effected by Starr, plaintiff and his family had no reason to investigate Buchwald’s financial transactions nor the administration of the estate by Starr.”
     Starr, who also handled financial accounts for Uma Thurman and Lauren Bacall, was arrested in 2010 on 23 criminal counts, including fraud and money laundering. He was sentenced to seven and half years in prison.
     Art Buchwald died of kidney failure on Jan. 17, 2007.
     The next day, The New York Times’ website posted his video obituary in which he declared: “Hi. I’m Art Buchwald, and I just died.”
     Joel Buchwald seeks compensatory damages for negligence, and attorney fees.
     He is represented by Jonathan Cuneo, with Cuneo Gilbert & LaDuca.

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