By DAN CROWLEY
Daily Hampshire Gazette
Staff Writer
NORTHAMPTON — SealRyt Corp. president Mark Wilkinson told jurors Thursday that despite his bookkeeper’s teary confession to him that she stole tens of thousands of dollars from the company, he chose not to report the alleged theft to his accountant, attorney or to the Internal Revenue Service when the agency audited the company in 2010.
The federal audit came just weeks after Lori Towne, SealRyt’s longtime bookkeeper, allegedly confessed to stealing the money over a two-year span and signed a document in Wilkinson’s office attesting to the alleged theft, according to testimony during Towne’s embezzlement trial in Hampshire Superior Court.
Prosecutors allege that, between 2002 and 2010, Towne, 51, of Westhampton, stole more than $200,000 from Wilkinson’s Westfield company, formerly of Easthampton, using company checks to pay three personal credit card accounts, personal car insurance and phone bills, and herself. She is charged with six counts each of larceny over $250 by single scheme, check forgery, and uttering false checks, as well as a single count of embezzlement by broker.
During cross-examination, one of Towne’s defense lawyers, Alan Rubin, focused on Wilkinson’s knowledge of and role in handling the company’s finances, as well as his authorization of company expenses. Some of those expenses revealed by Rubin in court Thursday included SealRyt making child-support payments on behalf of Wilkinson’s son, who was sometimes employed by the company; a $9,000 payment to an employee in Georgia to build a home office; and a series of non-payroll checks to an employee in Florida in 2010 amounting to more than $12,000. Wilkinson testified that the latter was “news to me.”
“You would have to authorize them,” Rubin, of the Committee for Public Counsel Services, said of those payments to the employee in Florida. “He just got those checks out of the blue?”
Wilkinson said he welcomed anything the IRS might find during its audit — and, in later testimony, said he was not worried about the audit results because he “thought everything was in order.”
“I knew from the confession that something very wrong had gone on, but I was also being told, from Ms. Towne, that everything had been expensed,” Wilkinson said.
“You knew there were discrepancies in the books that could be found by the IRS,” Rubin said to Wilkinson during his second day on the stand. “You could have told the IRS from the beginning.”
When Rubin suggested that Wilkinson instructed Towne not tell anyone about the theft of company funds, Wilkinson replied that he did not recall such instructions. He also denied discussing with Towne what to do if the IRS found any discrepancies in the company’s financial records.
Rubin pressed Wilkinson on why he chose not to report Towne’s alleged confession to anyone in advance of the IRS audit, including company accountant Carl Hartig, who was dealing directly with the IRS.
“He (Hartig) was presenting information that very well could have been wrong,” Rubin said in court — to which Wilkinson acknowledged, “I, in fact, knew otherwise.”
Wilkinson told jurors Wednesday that he wanted to keep Towne employed through the IRS audit because she was the only employee who had an understanding and knowledge of all the financial details the IRS might want. He suggested, in answers to various questions from Rubin, that he was not involved in the day-to-day financial affairs of his company.
“I had no idea how long the audit was going to last. I had no choice but to keep her on,” he told jurors Wednesday.
Also Wednesday, Assistant Northwestern District Attorney Jayme A. Parent presented Wilkinson with more than 200 company checks paid to what prosecutors allege were Towne’s personal accounts. In each case, Wilkinson said he did not authorize use of the checks, the vast majority of which carried his stamped signature and Towne’s handwritten signature.
On Thursday, Parent presented Wilkinson with another three dozen checks that were stamped with his signature and signed by Towne — some under her former name, Lori Chaffee — which Wilkinson said he also did not authorize. Those checks were allegedly used to pay Towne’s personal phone bills.
The trial before Judge Mary-Lou Rup is scheduled to resume Friday morning and continue into next week.
Dan Crowley can be reached at [email protected].
