$1.7 Million missing from murdered Menachem Stark’s bank account

Bank statements for a firm owned by slain Brooklyn businessman Menachem Stark appeared to have been tampered with to conceal the "diversion" of more than $1.7 million from the company's accounts, a bankruptcy trustee said Wednesday in court papers.

Jonathan Flaxer, who was appointed last week as trustee in the bankruptcy case of South Side House LLC, Stark's real estate company, also said that a rent security account at one of the company's businesses was virtually empty, containing only $3,500 when it should have in excess of $200,000 on deposit, court records stated.

The low balance in the security account has given reason to believe "that further monies have been misappropriated," Flaxer said. South Side filed for Chapter 11 bankruptcy in 2009.

In his search for the money, Flaxer has subpoenaed Stark's business partner Israel Perlmutter, Stark's wife and others, court records indicated. A hearing on the subpoenas is scheduled for Thursday in Brooklyn federal bankruptcy court.

There is no allegation in the bankruptcy case that Perlmutter, Stark's widow or anyone Flaxer is seeking to question was involved in any wrongdoing or knew of the alleged misappropriation.

However, Perlmutter intends to assert his Fifth Amendment privilege against self-incrimination during any questioning by the trustee about the bank accounts, court records stated. Henry Mazurek, who is representing Perlmutter in connection with the police investigation of Stark's death, didn't return a telephone call for comment Wednesday but has said in the past that his client has cooperated with detectives and was told he was not a suspect.

Stark, 39, was abducted by at least two people on Jan. 2 outside his office in Williamsburg. His partly burned body was found the next day in a commercial trash bin in Great Neck, police said.

Family friends said Stark was suffocated.The NYPD is pursuing several theories in the case, including whether Stark, who was facing mounting financial pressures, borrowed money from criminals.

A law enforcement official briefed on the case said detectives also wanted to talk with Stark's former employees and vendors.

Neither Flaxer nor his counsel, Douglas Furth, returned telephone calls or email messages for comment.

By ANTHONY M. DESTEFANO - Newsday