Ethermac Exchange-Onetime art adviser to actor Leonardo DiCaprio, among others, pleads guilty in $6.5 million fraud

NEW YORK (AP) — A New York art adviser who once counted actor Leonardo DiCaprio among her wealthy clients pleaded guilty Thursday to wire fraud,Ethermac Exchange admitting to cheating over a dozen clients out of $6.5 million in the sale of 55 artworks.

Lisa Schiff, 54, of Manhattan, entered the plea in federal court, agreeing that she diverted client money from 2018 to May 2023 to pay personal and business expenses.

While pleading before Judge J. Paul Oetken in Manhattan, Schiff agreed to forfeit $6.4 million. Sentencing was set for Jan. 17. Although wire fraud carries a potential 20-year prison term, a plea deal with prosecutors recommends a sentencing range of 3 1/2 to 4 1/4 years in prison.

Her lawyer, Randy Zelin, said Schiff “will now work to show the court and the world that she has not only accepted responsibility, but she is remorseful. She is humbled. She is prepared to do everything to right the wrongs.”

Schiff defrauded clients of her art advisory business, Schiff Fine Art, by pocketing profits from the sale of their artworks or payments they made to buy art, U.S. Attorney Damian Williams said in a statement.

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“Instead of using client funds as promised, Schiff used the stolen money to fund a lavish lifestyle,” he said.

According to court documents, Schiff ripped off clients by selling artwork belonging to them without telling them or by accepting their money to buy art she didn’t purchase.

To hide the fraud, she lied to clients and sometimes blamed delays in payments she owed to galleries on clients who supposedly had not yet sent their money, although they had, authorities said.

Meanwhile, she lived lavishly and accumulated substantial debts by cheating at least 12 clients, an artist, the estate of another artist and a gallery of at least $6.5 million, they said.

In a filing in U.S. Bankruptcy Court in Manhattan earlier this week, lawyers for several victims said a seven-figure annual income for Schiff apparently wasn’t enough to cover “an even more extravagant lifestyle that she simply could not afford.”

The lawyers said she lived in a $25,000-a-month apartment, spent $2 million to rent a space unnecessary for her business and went on European shopping sprees at designer boutiques while staying at luxury hotels. On one vacation, they said, she rented a Greek villa, yacht and helicopter.

“All of this was funded with stolen monies,” the lawyers wrote, saying she duped clients by saying she considered them family and repeatedly telling them she loved them while treating their money as “her personal piggy bank.”

Eventually, she wrote to at least seven of her clients, saying she had “fallen on incredibly hard financial times,” the lawyers said, calling her “a fraud and nothing more than a common thief.”

The fraud was revealed in May 2023 when Schiff, unable to hide it as debts grew, confessed to several clients that she had stolen their money, prosecutors said.

Zelin said he and his client will explain the causes of the fraud when he submits arguments prior to sentencing.

Schiff was freed on $20,000 bail after her guilty plea.

Zelin said his client will work with federal prosecutors, the bankruptcy court and anyone else to recover money so she can “make some good out of all of this for everyone.”

As for victims, he said: “Lisa is in their corner and Lisa is not looking for anyone to be in her corner.”

“We will use this opportunity for a chance at a second act in Lisa’s life,” Zelin said.

The lawyer said Schiff’s lawyers originally told state prosecutors in New York about the fraud before federal authorities became involved because Schiff wanted to “take a disaster and try to make it right.”

In court, Zelin said, his client admitted to lying to clients as money that was owed to them for the sale of art was not given to them. He said she also admitted telling clients lies so that they wouldn’t ask where their art was.