Former DPG chair Mike Berlon charged with defrauding clients of $1.8 million

Very bad timing for Georgia Democrats. Michael Berlon abandoned leadership of the state Democratic Party last year, replaced by former state lawmaker DuBose Porter. From the press release:

"This defendant is charged with defrauding his own clients out of over $1.8 million," said United States Attorney Sally Quillian Yates. "They came to him for legal help, and instead he drained their bank accounts."

J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: "Individuals relying on the professionalism and trust of individuals like Mr. Berlon should be able to turn to someone when that trust is violated. The FBI, in being well positioned to investigate such allegations involving the diversion of funds through mail and wire fraud, is that someone."

According to United States Attorney Yates, the charges, and other information presented in court: Berlon, who practiced in Grayson, Ga., through his law firm, the Law Office of Michael R. Berlon, is charged with obtaining funds from clients of his law firm and other individuals through false pretenses. The indictment alleges that some clients provided money to him believing that he would create a trust for them, and would hold the funds in trust. Instead, Berlon used the funds for personal expenses, including to pay his American Express bill and to repay other clients.

The indictment also alleges that in one instance, Berlon obtained money from two individuals who were looking for his assistance with starting a new business. He told the victims that he would help them get a loan, but they were required to provide a percentage of the requested loan amount as a down payment. Instead of assisting them with obtaining a loan, Berlon used the funds for his personal expenses and debts. In total, it is alleged that Berlon received at least $1.8 million in client funds from 2008-2013.

Berlon, 55, of Grayson, Ga., was arraigned before United States Magistrate Judge Justin S. Anand. He was indicted by a federal grand jury on September 9, 2014.

Here's the terse reaction from Michael Smith, spokesman for the state Democratic Party:

"The Democratic Party of Georgia desired and secured the resignation of Berlon more than a year ago. Under new leadership, the Party is thriving and we continue to look forward, rather than behind."