Kenneth Starr, an investment adviser to celebrities and other wealthy New Yorkers, defrauded clients of at least $59 million over the last five years, according to a U.S. grand jury indictment on Thursday.
Starr, 66, was initially charged on May 27 following his arrest while hiding in a darkened closet in his Manhattan luxury home. A criminal complaint at the time put his alleged fraud at $30 million, but the indictment doubles the scope of the allegations.
The indictment in Manhattan federal court said Starr, who has not been granted bail, committed 20 counts of wire fraud and one count each of money laundering, fraud by an investment adviser and securities fraud since 2005.
In the less than two weeks since Kenneth Starr's arrest ... The scope of alleged fraud has doubled, Manhattan U.S. Attorney Preet Bharara said in a statement.
The indictment included a list Starr's bank accounts and assets the government seeks to recover totaling $57.3 million, including funds held in an account registered to Poledance Superstar and Starr companies Colcave LLC and Marose LLC.
Starr's wife, Diane Passage, is a former nightclub pole dancer. In a parallel civil case brought by the U.S. Securities and Exchange Commission, Passage was named as a recipient of funds.
Abbe Lowell, an attorney who represented Starr at a court hearing on Thursday in the SEC lawsuit, told reporters Starr did not yet have a lawyer for the criminal case. Lowell was not immediately available to comment on the indictment.
Starr is not the same Ken Starr who led the investigation of former President Bill Clinton in the affair over White House intern Monica Lewinsky.
According to an affidavit by an Internal Revenue Service agent, Starr ran a complex set of schemes involving his son, his wife, prominent New York Democratic Party politician Andrew Stein, an unidentified former national official of a major political party and an unidentified partner at a prominent law firm.
None of the court documents identified the celebrities and wealthy New Yorkers who were Starr's clients, but lawyers said one was 99-year-old heiress Rachel Mellon and another a wealthy Manhattan jeweler, Jacob Arabov. An April 2008 private civil lawsuit against Starr identified some of his clients as film director Mike Nichols, writer Neil Simon and actor Wesley Snipes.
The cases are USA v Kenneth Starr and Andrew Stein, U.S. District Court for the Southern District of New York and SEC v Starr et al No. 10-04270.
(Reporting by Grant McCool and Basil Katz; editing by Andre Grenon)