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LOWELL — A 41-year-old Lowell woman is facing 78 counts of theft and check forgery after she allegedly altered a bank-deposit stamp for a local dental management company and pulled out nearly $28,000.
MEMORANDUM OF DECISION
Before the Court is Linda Massod’s complaint seeking a determination that a debt she claims is owed to her by debtor Terry Fayad, arising from their co-ownership and operation of a joint dental practice, is excepted from discharge. Having tried the matter, I now render my decision.
Linda Massod and Terry Fayad, both dentists, formed a romantic relationship in the late 1980s and a professional relationship in the early 1990s. Both relationships failed in the late 1990s, when they separated from each other romantically and professionally. Their breakup was not without recriminations. Those recriminations reverberate to this day and include Massod’s state court lawsuit against Fayad in 1999, Fayad’s bankruptcy case in 2000, and Massod’s exception to discharge complaint in 2001, the subject of this adversary proceeding.
In the adversary proceeding, Massod makes two allegations. First, she alleges that, to induce her to form a joint dental practice, Fayad falsely promised that her dental school loans would be paid from funds generated by that practice and that, relying on that false promise, she was damaged. Second, she alleges that Fayad misappropriated funds from their joint practice for himself and his brother, thereby causing the financial deterioration of the practice and consequent damage to her. Based on these allegations, Massod asks the Court to except from discharge the debt she claims Fayad owes her for the damages caused by his false promises as to her student loans and by his misappropriation of corporate funds. She grounds each request in three separate provisions of the non-dischargeability statute: § 523(a)(2)(A) regarding fraud; § 523(a)(4) regarding fraud or defalcation while acting in a fiduciary capacity; and § 523(a)(6) regarding willful and malicious injury. Fayad denies these allegations.
She also alleges that Fayad made but never intended to honor a later agreement implementing that promise, thereby further damaging her.
I tried these matters on four separate days over a period of several months. At trial, four witnesses testified: Massod, Fayad, their former accountant, and a former joint practice employee (currently employed by Massod). I admitted hundreds of pages of documents including credit card statements and bank statements. The non-party witnesses were generally credible, but the substance of their testimony was peripheral. Massod and Fayad were understandably, perhaps predictably, self-serving in their testimony. Fayad at times was not credible. After trial, I reviewed the trial documents, the testimony, the post-trial submissions, and applicable law. I now set forth my analysis, findings, and rulings.
Massod has the burden of going forward and the burden of proof by a preponderance of the evidence as to each of the elements of the separate causes of action in her complaint. Grogan v. Garner, 498 U.S. 279 (1991). See Collier on Bankruptcy ¶ 523.04 (15th ed. rev.).
Under § 523(a)(2)(A), Massod must demonstrate that (1) Fayad made a false representation (2) which he knew at the time was false (3) and which he made with the intent and purpose of deceiving Massod (4) on which Massod justifiably relied and (5) as a result of which reliance and as a consequence of which false representation, Massod sustained a loss or damage. 11 U.S.C. § 523(a)(2)(A); In re Spigel, 260 F.3d 27, 32 (1st Cir. 2001). See Collier on Bankruptcy ¶ 523.08 (15th ed. rev.).
Under § 523(a)(4), Massod must demonstrate that (1) a fiduciary relationship existed between Fayad and her, and (2) Fayad committed fraud or defalcation in the course of that fiduciary relationship, (3) causing harm to Massod. 11 U.S.C. § 523(a)(4). In re Baylis, 313 F.3d 9, 17 (1st Cir. 2002). See Collier on Bankruptcy ¶ 523.10 (15th ed. rev.).
Under § 523(a)(6), Massod must demonstrate that (1) Fayad injured her (2) with either the intent to injure her or at least the intent to do an act which he was substantially certain would lead to the injury in question, and (3) the injury was wrongful, without just cause and committed in conscious disregard of his duties. 11 U.S.C. § 523(a)(6). Kawaauhau v. Geiger, 523 U.S. 57 (1991) (as to “willful”); Printy v. Dean Witter Reynolds, Inc., 110 F.3d 853, 859 (1st Cir. 1997) (as to “malicious”); Burke v. Neronha (In re Neronha), 344 B.R. 229, 231-232 (Bankr. D. Mass. 2006) (expanding on objective and subjective elements of malice). See Collier on Bankruptcy ¶ 523.12 (15th ed. rev.).
Here are the facts established at trial. In the early 1990s, Massod had a developing dental practice as a solo practitioner, with a patient roster, an office, and an independent business operation. She also had limited financial and business experience and substantial student loans. At that time, Fayad had no independent practice but rather was employed as a dentist by the City of Cambridge, Massachusetts. Fayad occasionally assisted Massod in her practice. He had considerably more business experience and financial expertise than Massod, or so he represented to her. At that time, Massod and Fayad were engaged in an on-going, established romantic and domestic relationship. At some point in that time period, Fayad suggested that they form a joint dental practice, and they did so. They became co-owners of the professional corporation through which that practice was conducted. They agreed-upon their respective practice areas and conducted their practice in accordance with that agreement. They also agreed-upon their respective corporate titles and roles, with Massod as president and principal marketer and Fayad as treasurer, keeper of the corporate books, and manager of the corporate finances (as well as Massod’s personal finances). They agreed to share equally in the profits of the practice. They also agreed that Massod’s student loans would be repaid through revenues generated by the practice; they did not at first reduce this agreement to a writing. This repayment commitment was a major factor for Massod in her consideration of, and agreement to, the joint practice arrangement, and one upon which she relied. Massod and Fayad provided working capital for the operation of the practice primarily through the use of personal credit cards. In a somewhat atypical and unbusinesslike practice, they employed these credit cards for personal and business expenditures, paying the card billings with corporate funds and directing their accountant at year end as to the allocation of business and personal credit expenditures for income, tax reporting, tax treatment, and financial statement purposes. Fayad instituted and indeed insisted upon this practice, and he did so with Massod’s acquiescence and trust. While their testimony differed on this subject, Massod credibly testified that Fayad maintained sole possession and control over the corporate and practice books and records, and that he resisted Massod’s efforts to review those books and records herself or to engage professionals to review and maintain them. Although she lacked access to these books and records, she nonetheless observed both growth in the practice, which was evident from the increasing patient roster, and, at the same time, signs of financial distress in the business: collection calls, delayed payrolls, balky suppliers, limited income, and unpaid student loans.
Massod testified, without rebuttal, that the student loans were in the approximate amount of $100,000. She contends that, as a consequence of Fayad’s false promises and misappropriations, her loans increased by at least $50,000.
The evidence indicates that they made comparable contributions to the initial capital formation of the corporation.
Fayad’s brother Hidar had financial dealings with Fayad personally and with the corporation. During 1995-1999, the corporation paid substantial sums to Hidar, either directly or through the credit card accounts. Fayad contends that the payments to or on account of Hidar were in repayment of loans or for services rendered. Massod disputes that any loans or services were rendered by Hidar, and she contends that she never authorized any such recompense to Hidar. Hidar did not testify at trial. The documentation is not conclusive. Massod’s testimony on this subject was credible. Fayad’s was not credible. I find that Fayad diverted corporate funds to Hidar without any consideration from Hidar, financial or otherwise.
In July 1997, Fayad and Massod caused the corporation to make an agreement with Massod. The agreement was intended to implement the student loan repayment promise that was a key consideration in Massod’s decision to proceed with the joint practice. Under the agreement, the corporation would re-deploy corporate revenues resulting from the retirement of various corporate office equipment leases toward repayment of Massod’s student loans. The agreement also provided that Massod and Fayad, under certain circumstances relating to the financial performance of the practice, would consider using excess cash flow from the practice for such student loan repayment. These corporate repayment obligations were secured by the grant of a security interest in the corporate equipment. Fayad refused to attend to the paperwork, namely, the issuance of a promissory note and the execution and recordation of the requisite financing statement necessary to render such corporate obligation and collateral commitment perfected and hence meaningful. Moreover, he failed to provide the financial information regarding the performance of the practice upon which the use of excess cash flow for student loan repayment would be based. In any case, Massod’s student loans were not repaid, at least not from corporate revenues in accordance with the Fayad’s promise and the written agreement. Fayad explains his refusal to complete the student loan deal on the breach in their personal relationship, having “caught her cheating.”
In February 1999, three relevant events occurred. First, Massod had occasion to review a corporate bank statement that aroused her concern and confirmed her suspicion that the finances of the practice were not being handled properly or being reported to her accurately.Second, Fayad discovered that Massod was engaged in a relationship with another man, by his testimony causing an immediate breach in his relationship with Massod. And third, Fayad left Massod and promptly established a romantic and domestic relationship with another woman whom he married several months later. Thereafter, Massod and Fayad maintained their joint practice until, commencing in July 2000, Fayad opened his own office, developed a practice, and established a marital residence.
The statement reflected a monthly revenue deposit of approximately $88,000, an amount she considered inconsistent with the distressed finances of the practice and the mounting financial difficulties of the business operation.
During the year and a half following their domestic separation in February 1999, Fayad and Massod practiced together in the same office and under the joint practice banner. By both accounts, the forced professional proximity was awkward and strained. Not surprisingly, they engaged in a series of acrimonious encounters and disputes regarding the practice. These concerned the disposition of corporate assets, the collection and disbursement of corporate receivables, the maintenance of the patient roster, and access to the corporate books and records. As noted, Massod sued Fayad in state court for breach of contract, breach of fiduciary duty, and an accounting. In that action, they executed a stipulation and injunction intended to regulate the joint practice under the eye of a custodian (who is no longer active in that action). Ultimately, burdened by debt, Fayad commenced the underlying bankruptcy case on June 29, 2000. In the bankruptcy case, he listed $238,164 in nonpriority unsecured debts, a substantial portion of which comprised credit card debt to various issuers. The state court litigation, like Fayad’s bankruptcy, awaits the outcome of this adversary proceeding.
Here are my rulings.
A. Misuse and Misappropriation of Corporate Funds
Each party contends that the other misappropriated practice funds primarily through the use of corporate-funded credit cards for unauthorized personal expenditures. Certainly, their business practice — funding working capital and personal needs through personal credit cards — is particularly susceptible to such misuse. Their strategy at trial as to this matter consisted of presenting what appears to be virtually all of the credit card bills and bank statements for the period in question, together with their respective characterizations of a selection of such charges as instances of the alleged misappropriation, presumably calling upon the Court to render a decision based upon an extrapolation of such charges to encompass a substantially greater sum. While it is Massod’s burden to make that case in this litigation, neither she nor Fayad has done so. Both used the credit cards, and did so both for corporate and personal purposes. Disentangling and examining each and every such charge for a determination of misuse may be possible but that has not been attempted, much less accomplished by either party. To the extent that evidence on this issue was presented, it tended to favor Massod in that she credibly explained the particular charges brought forward by Fayad. Nonetheless, with the exception noted below, Massod has not proved by a preponderance of the evidence Fayad’s misappropriation of the vast sums she claims in her complaint.
B. Defalcation in a Fiduciary Capacity
A discharge exception under § 523(a)(4) based on defalcation while acting in a fiduciary capacity requires a demonstration that Fayad acted in a fiduciary capacity in his dealings with Massod. Fayad and Massod did owe each other duties of good faith and loyalty. However, as co-owners, they enjoyed equal rights and powers with respect to the corporation and the joint practice, even if Massod ceded control of important aspects of her personal and professional life to Fayad, at least for a while. That acquiescence is not enough to warrant the conclusion that either was acting in the requisite fiduciary capacity. See In re Carlson, 334 B.R. 626, 629 (Bankr. C. D. Ill. 2005). Thus, in the absence of such fiduciary capacity, Massod has not established by a preponderance of the evidence one of the elements of her defalcation causes of action. Accordingly, the causes of action relating to the student loans and the misappropriation of corporate funds under § 523(a)(4) fail.
In Massachusetts, shareholders of a closely held corporation are likened to partners and deemed to have the same duty of utmost good faith and loyalty to each other. Donohue v. Rodd Electrotype Co. of New England, Inc., 328 N.E. 2d 505 (1975). Donohue is typically invoked to protect the minority against the majority. See also In re Curran, 157 B.R. 500 (Bankr. D. Mass. 1993); In re Romano, 353 B.R. 738 (Bankr. D. Mass. 2006). Here, Massod and Fayad occupied the same status as co-owners and had equal rights and powers with respect to the management and operation of the practice and its business. For § 523(a)(4) purposes, I find that their relationship was not the fiduciary one contemplated by the statute. See also In re Bologna, 206 B.R. 628, 632 (Bankr. D. Mass. 1997) (“fiduciary capacity” is limited to “the capacity of one who holds property under either an express trust or . . . a technical trust, but not under a trust imposed by law as a remedy, as a constructive trust, an implied trust, or a trust ex maleficio”).
C. Fraud Regarding the Student Loans
Further, Massod has not proved by a preponderance of the evidence that Fayad made a false representation when he agreed, in 1994, to cause her student loans to be repaid from their joint practice. Nor has she established that he did so when he caused the corporation to enter into the collateralized repayment agreement, in 1997. Nothing he said or did at either time establishes that he did not intend to perform the student loan repayment commitment at the time he agreed to do so. He may have broken his promise and breached his agreement subsequently; however, the evidence does not support the conclusion that he engaged in fraud in making either the promise or the agreement. Accordingly, the cause of action relating to the student loans under § 523(a)(2)(A) fails.
D. Fraud Regarding Hidar
Massod contends that Fayad’s liability to her, arising from his diversion of corporate funds to Hidar, is excepted from discharge under § 523(a)(2)(A) as a debt arising from fraud or a false representation because Fayad falsely represented to her that his brother Hidar provided loans and services to the corporation and that the diversion of corporate funds to Hidar constituted the repayment of such loans and recompense for such services. The evidence shows only that Fayad did divert corporate funds to Hidar, and that Fayad, to cover up this diversion, falsely represented to Massod that the payments to Hidar were compensation for value provided by Hidar to the corporation. The evidence fails to establish a requirement of § 523(a)(2)(A): that her reliance on the misrepresentation was a cause of the damage suffered. Here, the damage was caused by the diversion itself. The misrepresentation served to cover-up the wrongfulness of the diversion, but Massod has not demonstrated that it caused the diversion in the first instance. Accordingly, liability arising from the diversions to Hidar is not excepted from discharge under § 523(a)(2)(A).
Fayad’s testimony on this subject was notably inconsistent, evasive, and ultimately lacking in credibility.
E. Willful and Malicious Injury Regarding the Diversion of Corporate Funds
Massod also contends that Fayad’s liability to her, arising from his diversion of corporate funds to Hidar, is excepted from discharge under § 523(a)(6) as a debt for willful and malicious injury to another entity. The injury includes both diminution in the value of her interest in the corporate joint practice and an increase in her own personal liability as a result of the consequent failure of the corporation. Massod has satisfied the requirements of § 523(a)(6) as to these transfers. I find that Fayad made the transfers with at least substantial certainty that they would harm both the corporation and Massod as a one-half owner. He clearly understood as well that every dollar diverted to Hidar diminished the value of the corporation and of Massod’s interest in it. The injury to Massod was therefore “willful” within the meaning of § 523(a)(6) and the Kawaauhau decision. The payments to Hidar were also objectively wrongful in that they were not proper or authorized corporate expenditures, they served no corporate purpose, and they were not sanctioned by any agreement or understanding between himself and Massod. Moreover, Fayad clearly understood the wrongfulness of these diversions. The injury was therefore both objectively wrongful and made with conscious disregard of that wrongfulness, and it was thus “malicious” within the meaning of § 523(a)(6). The Court therefore concludes that Fayad’s liability to Massod for diversion of corporate funds to Hidar is excepted from discharge under § 523(a)(6) as a debt for willful and malicious injury to another entity.
Incident to the collapse of the joint practice, Massod had to pay certain corporate obligations that she and Fayad had guaranteed, including the balance due on a car lease. Massod testified, without rebuttal, that these obligations amounted to at least $40,000. In addition, upon failure of the practice, Massod lost the benefit of payments on her student loans that the corporation was obligated to fund.
F. Willful and Malicious Injury Regarding the Student Loans
Massod also contends that Fayad’s liability to her for failing to implement the student loan agreement — by failing to effectuate the corporation’s obligations (i) to make payments on her student loans and (ii) to give her a promissory note and security interest to secure the corporation’s obligation to her — is excepted from discharge under § 523(a)(6) as a debt for willful and malicious injury to another entity. I find that Massod has carried her burden of proof as to this count.
Fayad’s non-implementation of the student loan agreement injured Massod in two ways. First,by his failure to cause the corporation to make payments on the student loans, she was injured to the extent of payments that the corporation should have made but did not make, plus interest, penalties, and other finance charges that Massod incurred as a result of the nonpayment. Second, in failing to cause the corporation to give Massod a promissory note and security interest, he deprived her of a right to look to assets of the corporation as security for enforcement of the corporate obligation to pay her student loans. Fayad contends that, given the collapse of the joint practice, the security interest would have been subject to avoidance by the corporation’s creditors as a fraudulent conveyance; therefore, he urges, its value would have been negligible and his failure to cause the corporation to give Massod a security interest was not injurious to Massod. This argument, however, goes only to the extent of damages, which is not an issue before me. (Fayad does not contend that it was a factor he considered in his decision not to effectuate the student loan agreement, and I find it was not a factor.) In addition, Fayad has not established that the grant of a security interest would have been a fraudulent as to creditors, especially if he had effectuated it when he should have. There is no evidence that the grant of a security interest would have rendered the corporation insolvent or left it insufficiently capitalized. In any event, whatever the vulnerability of the security interest to avoidance, she had a right to the lien, and he had the obligation to cause the corporation to provide it.
In July 1997, when the lien agreement was made, the practice was in the midst of its highest revenue-producing year (followed by an even higher revenue-producing year in 1998). Thus, there was certainly a basis to view the lien as valuable and not subject to avoidance, thereby establishing, at least to that extent, the injury to Massod in Fayad’s refusal to perfect it.
Fayad testified that he did not implement the student loan agreement because he had caught Massod cheating on him. I find that his non-implementation of the agreement was deliberate, a considered refusal to carry out his obligation as an officer of the corporation, with full knowledge that it would injure her and indeed intent to injure. This was simple retaliation. The wilfulness of the injury is therefore established.
Fayad was also aware of the student loan agreement, of the corporation’s obligations under that agreement, and of his own obligation, as the corporate officer responsible for implementation of the agreement, to effectuate the corporation’s obligations thereunder. I therefore conclude that the injury was wrongful and inflicted in conscious disregard of a known duty: it was “malicious” within the meaning of § 523(a)(6). The Court therefore concludes that Fayad’s liability to Massod for failing to implement the student loan agreement is excepted from discharge under § 523(a)(6) as a debt for willful and malicious injury to another entity.
Fayad’s argument that Massod could just as readily as he, and with the same authority, have issued the requisite promissory note and executed and recorded the necessary financing statement is unpersuasive and irrelevant to the wilfulness and maliciousness of the injury. She was the less experienced and the more trusting of the two, less versed in general business practices, and even less so in the niceties of secured transactions, and he exploited that inexperience and trust. He held the upper hand in the finances of the corporation, and he knowingly used it to her detriment. Moreover, by their own division of labor within the corporation, the obligation to effectuate the student loan agreement was his.
In accordance with the foregoing findings and rulings, the Court concludes that Fayad’s liability to Massod for diversion of corporate funds to Hidar and for failing to implement the student loan agreement is excepted from discharge as a debt for willful and malicious injury. The Court makes no determination as to the existence or extent of the underlying liability; Massod may establish and enforce the underlying liability in another court of appropriate jurisdiction. All other counts in the complaint must be dismissed. A separate judgment will enter accordingly.
A receptionist at a Springfield-based dental office is facing 15 counts of obtaining drugs by fraud after allegedly using a dentist’s name to fill false prescriptions.
Candice Fazio, 47, allegedly used the electronic prescription system at Moini, Witzenberger and Associates to obtain narcotics, benzodiazepine and anti-biotics from the Super Stop & Shop pharmacy in Feeding Hills.
Fazio, who pleaded not guilty at her arraignment July 9 in Westfield District Court, is accused of filling prescriptions for acetaminophen with codeine, amoxicillin, lorazepam, acetaminophen with ozycodone and acetaminophen with hydrocodone.
Dr. Mohammad Moini said Fazio had worked in his office for under a year and was no longer in his employ. He was on vacation when another employee discovered the falsified prescriptions, he said in a phone interview.
According to an Agawam police report, the employee who discovered the alleged fraud found numerous electronic prescriptions deleted from the practice’s computer and found that Fazio had filled them. The practice then notified police.
Police interviewed Moini, who told them he had not written any prescriptions for Fazio, according to the report. Moini called the pharmacy and told them to not fill any more prescriptions in his name, the report said.
An employee at the pharmacy told the police Fazio had obtained drugs on a number of occasions, from Nov. 6 2014 to April 29 2015.
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NOTICE: Decisions issued by the Appeals Court pursuant to its rule 1:28 are primarily addressed to the parties and, therefore, may not fully address the facts of the case or the panel’s decisional rationale. Moreover, rule 1:28 decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28, issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent.
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
The defendant appeals from her convictions by a jury in Boston Municipal Court of six counts of larceny over $250, G. L. c. 266, § 30, and nine counts of uttering a false check, G. L. c. 267, § 5. On appeal, she asserts that (1) the Commonwealth presented insufficient evidence that the defendant forged the checks, and (2) the Commonwealth failed to prove that it was the defendant who stole the checks and presented them for payment.
The Commonwealth did not charge the defendant with forgery of a legal instrument. G. L. c. 267, § 1. The defendant’s claim of insufficiency with respect to the fraudulent endorsements is therefore directed to the forgeries as predicate acts necessary to prove the charges of larceny and uttering.
Background. We recite the relevant facts as the jury could have found them during trial. The defendant was a dental assistant at the offices of Beacon Dental from 2000 through 2011. The defendant worked closely with the dentist, Dr. Cressida Joseph, and the office manager, Brenda Allen, on a daily basis. Beginning in 2008, the defendant became the supervisor of all dental assistants, a position which required her to communicate with labs and pharmacies and to substitute for the receptionist during lunch breaks. The system for processing paperwork required the defendant to fill out routing slips containing patient information for the lab, or notes summarizing a patient’s visit. The defendant filled out roughly 3,000 routing slips per year; Dr. Joseph and Allen reviewed these on a regular basis. While covering for the receptionist during lunch breaks, the defendant had access to checks that were made payable to “Dr. Cressida Joseph, DMD.”
At some point in 2011, office staff discovered that checks endorsed with Dr. Joseph’s signature had been cashed at a nearby supermarket. Allen made inquiry to the bank on which the checks were drawn, and the bank provided her with copies of nine checks that had been endorsed and cashed. Dr. Joseph and Allen recognized the handwriting of the endorsements as that of the defendant. Dr. Joseph’s initials on the checks were similar to the manner in which the defendant signed her name on the lab forms that she routinely handled in communicating with labs on behalf of the office.
Discussion. We consider the defendant’s claims of insufficiency under the familiar standard ofCommonwealth v. Latimore, 378 Mass. 671, 676-677 (1979).
1. Endorsement. Allen, who had seen both the defendant’s and Dr. Joseph’s signatures on a near daily basis for eight years, testified that the endorsements were not executed by Dr. Joseph and that she recognized the handwriting as that of the defendant. Dr. Joseph also recognized the handwriting as that of the defendant. We are unpersuaded by the defendant’s assertion that the small sample of writing available for comparison by the witnesses or the fact that the jury were provided with neither expert testimony nor an exemplar of the defendant’s handwriting renders the evidence insufficient. We refer additionally to the evidence that the defendant had access to incoming checks and ample opportunity to endorse them. The Commonwealth was not required to eliminate every other possible suspect; the jury were entitled to infer that the defendant had forged Dr. Joseph’s endorsement on the checks.
2. Larceny. To support a conviction of larceny the Commonwealth must prove “(1) the unlawful taking and (2) carrying away (asportation) (3) of personal property of another (4) with the specific intent to deprive the person of the property permanently.” Commonwealth v. Vickers,60 Mass. App. Ct. 24, 27 (2003), citing Commonwealth v. Mills, 436 Mass. 387, 394 (2002). The Commonwealth’s evidence supported two relevant findings: (1) that the defendant forged Dr. Joseph’s signature on the checks in question, and (2) that at an unspecified later date these checks were presented for payment at a supermarket.
There has been no challenge at trial or on appeal to the judge’s recital of these elements in his use of the District Court Model Jury Instructions; the instructions themselves are not at issue in this case.
The Commonwealth’s evidence, as stated, was that the checks forged by the defendant were eventually taken to a nearby supermarket, and it points to the rational inference that the person who endorsed the checks would be the same person who carried them away. While the evidence was not overwhelming, the jury were entitled to use their everyday experience and common sense to conclude that the defendant, rather than the limited number of other individuals who had access to the checks in the office, was the person who carried them out the door. In conjunction with the evidence of forgery, the Commonwealth demonstrated both motive and opportunity sufficient to uphold the conviction for larceny under Latimore.
Uttering. To support a conviction of uttering the Commonwealth must prove that the defendant “(1) offer[ed] as genuine; (2) an instrument; (3) known to be forged; (4) with the intent to defraud.” Commonwealth v. Levin, 11 Mass. App. Ct. 482, 496-497 (1981). The evidence offered in support of these charges is the same two items of direct evidence — forgery by the defendant followed by notations indicating the checks had been cashed at a supermarket — offered in support of larceny.
It is undisputed that the checks in question were passed as genuine; however the Commonwealth presented no evidence that limited the possible number, or the identity of the person(s), who passed the checks. Evidence routinely presented in a case such as this is conspicuously lacking here. The Commonwealth produced neither witnesses from the supermarket to identify the defendant, nor any security videotape or other evidence tending to prove the defendant cashed the checks herself. See, e.g., Commonwealth v. Catania, 377 Mass. 186, 187-188 (1979), overruled on other grounds by Commonwealth v. Crocker, 384 Mass. 353, 357 (1981); Commonwealth v. O’Connell, 438 Mass. 658, 661 (2003). Indeed, there was no evidence introduced tending to show the defendant had ever patronized the supermarket in question. Equally pertinent, there was no evidence that access to the checks was restricted in any fashion once they left the confines of the dental office. Commonwealth v. Rodriguez, 456 Mass. 578, 582 (2010), quoting from Commonwealth v. Croft, 345 Mass. 143, 145 (1962) (“If a rational jury ‘necessarily would have had to employ conjecture’ in choosing among the possible inferences from the evidence presented, the evidence is insufficient to sustain the Commonwealth’s burden of proving guilt beyond a reasonable doubt”). See Commonwealth v.Chinn, 6 Mass. App. Ct. 714, 717 (1978) (evidence that defendant’s name appeared as payee on stolen checks insufficient to show that defendant knew the checks were stolen or participated in cashing them). The defendant may well have cashed these checks herself, but to conclude that she did so, the jury were required to speculate.
In light of our conclusion, we do not address the defendant’s argument that the checks were not shown to be instruments that can be “uttered.” G. L. c. 267, § 5.
Conclusion. This case presents a combination of evidence supporting a conviction for the uncharged crime of forgery, thin but sufficient evidence for the crimes of larceny, and insufficient evidence to sustain the convictions of uttering.
The judgments on the nine counts of the complaint charging uttering are reversed, the verdicts are set aside, and judgments shall enter for the defendant on those counts. The remaining six judgments are affirmed.
By the Court (Grainger, Rubin & Hanlon, JJ.), Clerk Entered: October 17, 2014.
SALEM — A former receptionist at a Salem dental office has been charged with stealing nearly $10,000 by telling patients they had to pay in cash, then pocketing the money.
During her arraignment yesterday in Salem District Court, Cindy Deleon, 26, of Revere pleaded not guilty to a charge of larceny of more than $250 by single scheme.
Prosecutor Colleen Cashman said Deleon was working for Aleris Dental on Lafayette Street, where she handled payments from customers.
But that wasn’t true — the practice accepted credit card payments.
Police and prosecutors say Deleon took the man’s payment, then, on the office computer, made an entry that he’d paid with a Visa card.
The man later realized that insurance should have covered his bill and tried to get a refund.
Salem police Detective Dennis Gaudet said in a report that Deleon had taken cash from 39 patients, for a total of $9,952.
Cashman asked Judge Robert Brennan to set a $1,500 bail for Deleon, citing a history of defaults on her criminal record.
“Allegedly,” responded Deleon’s privately hired attorney, Krista Larsen. “She stands before you with the presumption of innocence.”
Larsen went on to blame defaults in a prior Boston case on paperwork errors.
She also said Deleon, a graduate of Salem High School, was “laid off” from her job in August.
Brennan agreed to release Deleon on personal recognizance, with the condition that she stay away from her former employer.
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PALMER – A 56-year-old Hampden woman who authorities allege stole $55,370 from an East Longmeadow dentist while working as the office manager faces five years imprisonment on each of three criminal charges, court records show.
Lisa Giroux had been scheduled to be arraigned in Palmer District Court earlier this month on embezzlement, larceny and criminal transaction by false pretense charges, but her arraignment has been rescheduled to May 10.
A state police investigation says that from 2007 to 2015, while employed by Dr. Amy St. Germain, who has a dental office in East Longmeadow, Giroux allegedly gave herself unauthorized amounts of vacation pay, falsified financial records and destroyed time cards.
The investigation says Giroux, who was terminated by St. Germain in June, “was exclusively in charge of payroll.”
The police report says St. Germain stated that due to her own medical condition, she entrusted running the office to Giroux, had known Giroux since the 1990s, and that she began working for St. Germain in 2002.
Content retrieved from: http://www.masslive.com/news/index.ssf/2016/03/hampden_woman_charged_with_ste.html
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Phuong “Lisa” Nguyen of Quincy faces up to 51 months in prison and fines for forgery, mail fraud and wire fraud. Working as a dental office manager, she forged doctors’ names to insurance checks and deposited them to her own accounts.
For Phuong “Lisa” Nguyen of Quincy, the scheme was simple.
Starting in 2006, she got jobs as an office or front desk manager for Quincy-area dental practices, forged insurance reimbursement checks with doctors’ names and deposited them to her accounts.
Now she has pleaded guilty in federal court to embezzling hundreds of thousands of dollars.
Nguyen, 32, was convicted late Thursday on three counts of uttering a forged security, one count of mail fraud and one count of wire fraud.
She’ll be sentenced Sept. 13. By the terms of her plea agreement she faces up to 51 months in prison, three years of supervised release, a fine of up to $75,000, and restitution to the dental offices.
Prosecutors said Nguyen repeated her scheme at four local offices, going from one to another. When she also had access to the practice’s check book, she would also forge doctors’ name to those and cash or deposit them.
In at least one case Nguyen was fired when her embezzlement was discovered.
The U.S. Attorney’s Office was assisted in the investigation by the U.S. Postal Service, the Norfolk and Suffolk County District Attorney’s offices and the state insurance fraud bureau.
Editor’s note — as you may know, we normally confine ourselves to investigating dental office embezzlement. However, we do provide reporting on significant embezzlements in medical offices because the methodologies employed have considerable commonality.
SPRINGFIELD — The former office manager of a medical practice in Northampton pleaded guilty in U.S. District Court to embezzling $1.6 million from the group over five years, and shielding the lion’s share of the theft under purported supplies for cancer care. Roxanne Tubolino, 55, of Belchertown, pleaded guilty to wire fraud and six counts of tax evasion. She faces a maximum prison sentence of 20 years, but will more likely be exposed to just over five years behind bars under advisory sentencing guidelines. Tubolino dabbed at her eyes and admitted to the counts in a small voice. In the courtroom were her mother and Dr. Deborah Smith, the lone oncologist at the four-member Northampton Internal Medicine Associates in Florence. “I bore the brunt of it,” Smith said after the hearing, referring to the scheme that stretched back seven years. “Most of the theft, she wrote off as supplies and medication for chemotherapy. I guess it was a good place to hide it.” Smith said patient care did not suffer – only her bottom line did. Federal prosecutors say Tubolino was responsible for keeping the books at the office, and wrote off thousands of dollars each month to “oncology supplies” and other medical expenses. Meanwhile, she was paying off purchases on her Visa Black Card and other credit cards, according to the government. “She wrote hundreds of checks to pay her personal credit card bills,” Assistant U.S. Attorney Steven H. Breslow said, detailing the purchases. “Cash advances, clothing stores, restaurants and entertainment venues.” Prosecutors and Smith said she discovered the discrepancies and confronted Tubolino in 2013. Tubolino “admitted to another physician … that she had basically been stealing” from the practice, Breslow told U.S. District Judge Mark G. Mastroianni. After the plea hearing, Smith said she is still trying to financially pick up the pieces at the practice. She also has sued Tubolino in Hampshire Superior Court over the embezzlement, and the defendant agreed to pay restitution as part of her plea agreement. “We’re working at it,” Smith said. “But you know … it’s not cancer.” Tubolino’s sentencing hearing is scheduled for April 16. Content retrieved from Former cancer care office manager admits embezzling $1.6 million from Northampton practice | masslive.com