At least four Brooklyn judges have bizarrely recused themselves from a legal case involving more than $2 million in allegedly missing investor money and a longtime local Democratic power broker.
Two of the jurists stepped away from the case just this week — including one who had been on the verge of issuing an arrest warrant over the mislaid funds, as well as possible sanctions against former Brooklyn Democratic Party chairman Frank Seddio.
Brooklyn Supreme Court Judge Richard Montelione recused himself Tuesday, after Seddio announced he was retaining a lawyer who was coincidentally representing the jurist in an unrelated lawsuit, sparking a potential conflict of interest.
A judge serving on a case involving longtime Brooklyn power broker Frank Seddio lasted one day before recusing himself. William C Lopez/New York Post
Following Montelione’s recusal, Judge Richard Velasquez also recused himself on Tuesday, without noting a reason.
Currently, Judge Francios Rivera is overseeing the lawsuit — the fifth judge assigned to the case.
The saga, as first reported by The Post, began last year when a pair of international investors put the $2 million into escrow with a Brooklyn lawyer, Mark David Graubard, to prove they had the funds necessary for potential business venture with real estate investor Sam Sprei, who has ties to Seddio.
But when they tried to get their money back, the investors claim Graubard allegedly stalled and refused to even provide proof that he still had the money.
The investors indicated they would report the ostensible theft to authorities — at which point Seddio initiated the lawsuit in Brooklyn Supreme Court, and was immediately granted a restraining order that blocked their efforts.
Brooklyn Supreme Court Judge Richard Montelione recused himself Tuesday after Seddio announced he was retaining a lawyer who is also actively representing the judge in an unrelated lawsuit. Paul Martinka
But judges on the case have since demanded to know where the money is, and why nobody can seemingly account for it, over the last year.
Last week, Montelione finally appeared ready to issue an arrest warrant for escrow agent Graubard for refusing to produce bank records, as well as sanctions sought by the investors against Seddio for months of alleged delay tactics and machinations.
On Monday, Seddio announced in a letter to the court that he was hiring attorney Imran Ansari to represent him in ongoing sanctions proceedings against him in connection to the suit he initiated.
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But because Ansari was representing Montelione in an active suit against the state over judicial retirement, the jurist immediately recused himself.
“Oh really, I had no idea,” Seddio told The Post Wednesday of the apparent conflict of interest. “I thought that case was dismissed.”
He added: “I have nothing to do with this case. Tell them to go f–k themselves.”
“I have nothing to do with this case,” Frank Seddio told The Post when reached by phone. “Tell them to go f–k themselves.” Paul Martinka
He praised the appointment of the latest judge on the case, saying “Good. Rivera is one of the best judges on the bench.”
And Seddio insisted that he barely knows Graubard, despite at least two other state court lawsuits involving the pair.
“If you brought him into my office now,” Seddio said, “he’d have to reintroduce himself.”
Neither Graubard nor his attorney, Israel Goldberg, responded to a request for comment.
Former Brooklyn Dem heavyweight, Frank Seddio, is helping a con-art scheme to defraud investors by abusing his powerful political influence, a federal lawsuit filed in October claims. Gregory P. Mango
As the gymnastics in state court continue, Seddio, Gaubard and others are facing a federal lawsuit from the jilted investors, Swiss investor Angelos Metaxas and a New Zealand firm, Pertshire Investments LP, over the alleged attempts to stymie their efforts to recoup the funds from escrow.
“No person, let alone an attorney who wishes to remain one, would go to these lengths — violating multiple court orders and being held in contempt for doing so — to avoid providing a few simple records unless those records show something he absolutely does not want others to see,” said attorney Lauren Zimmerman of Selendy Gay, who represents the jilted investors.
“We are hopeful that the state court system will not tolerate this type of brazen abuse of its process — that it won’t let the public believe that the rule of law has no place in New York City,” said Zimmerman.