HAMMOND — A man once billed as a best-selling author, legal genius and business visionary left federal court Wednesday a prison-bound fraud.
U.S. District Court Chief Judge Jon E DeGuilio imposed a 33-month sentence Wednesday on 46-year-old Rajesh Kanuru.
Kanuru pleaded guilty last summer to embezzling more than $348,000 from Ronnie and Dana Nelson of Lake Station.
The family hired Kanuru’s Chicago’s law firm a decade ago to win a workman’s compensation claims against former employers.
Kanuru won $348,000 for the Lake Station family in 2015, but instead of handing the money over to them, he deposited the checks in his bank accounts, spent it on himself and kept it secret from the Nelsons.
When the Nelsons had to file bankruptcy, being more than $210,000 in debt from medical bills, Kanuru lied to bankruptcy court officials about the missing money to cover up his embezzlement.
The scheme fell apart in 2018 when the Illinois Supreme Court disbarred Kanuru for professional misconduct that cost a dozen other clients more than $700,000.
A federal grand jury in Hammond indicted Kanuru in September 2021 on charges of wire fraud and embezzlement of bankruptcy estates.
The charges carried a maximum penalty of 25 years imprisonment if a jury found him guilty.
He pleaded guilty last August to the felony counts under an agreement with the U.S. Attorney’s office to give up his right to make federal prosecutors prove the charges against him in return for leniency.
He also has agreed to pay his victims $348,388.50 inrestitution, although court papers indicate the Nelsons haven’t received any to date.
His defense attorney, Richard S. Kling, argued in a memo to the court that Kanuru deserved the shortest sentence possible because this was his first criminal offense and he needs to go to work to support his wife, two young children and repay his victims.
Kling said Kanuru received a master’s degree in business administration in 2001 from Loyola University and a law degree in 2005 from Kent College, both in Chicago.
He opened a private law practice in Chicago in 2005 specializing in workman’s compensation and personal injury cases.
His LinkedIn account states his law business grew exponentially, handing millions of dollars in cases in its first decade.
He claims to have written a weekly column in a national newspaper on legal issues, co-hosted a radio show and lectured on health-related litigation.
His attorney painted a darker picture of Kanuru's life and career. Kanuru was treated for attention deficit hyperactivity disorder in high school, bipolar disorder and most recently anxiety and depression.
“It was during this time that his law practice experienced upheaval and began to fall apart,” Kling writes.
Kling states Kanuru began misappropriating clients money, not for personal enrichment, but instead to keep the (law) practice running and prevent clients from discovering anything amiss…”from the chaos created by his poor business management and health issues.”
Kling said Kanuru suffered a complete mental breakdown around 2018, about the time he was forced to give up his license to practice law.
United States Attorney Clifford D. Johnson stated in a press release Kanuru’s frauds undermine the public trust in the nation’s bankruptcy system.
“The bankruptcy system, to work as it is designed, relies upon attorneys to act in the best interest of their clients and to comply with orders issued by the bankruptcy judges.
“When, as happened in this case, an attorney violates both his clients trust and his obligations to the bankruptcy court to unlawfully enrich himself, my office will seek justice by prosecuting to the fully extent of the law.”
Court papers state Kanuru has pending theft charges in Cook County Circuit Court regarding the embezzlement of other clients.
The investigation was conducted by the United States Postal Inspection Service in collaboration with the Northern Indiana Bankruptcy Fraud Working Group coordinated by the United States Trustee for Region 10. The case was prosecuted by Assistant U. S. Attorney Luke Reilander.
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