Trial set for Wabash Center's claim against late CFO's ex-wife

Trial set for Wabash Center's claim against late CFO's ex-wife


11:19 PM, Jan. 26, 2012

Wabash Center Inc.'s accounting practices will come under scrutiny next week when a lawsuit filed by the Lafayette-based nonprofit agency against the ex-wife of its former chief financial officer heads to trial.

The lawsuit is part of Wabash Center's ongoing effort to recoup more than $4.5 million that it alleges then-CFO Stephen P. McAninch stole between July 1991 and October 2009 by making numerous payments to a made-up company called "S&S Enterprises" and altering meeting minutes.

McAninch died on Oct. 30, 2009 -- the same day a forensic examiner discovered serious financial irregularities in Wabash Center's books. The nonprofit, which serves the developmentally disabled, then sued McAninch's ex-wife, Connie Landers, and his widow, Cheryl Wills, last summer.

Wills' attorney, Max Layden, and Wabash Center's attorney, William Kealey, said Thursday that the two parties reached an out-of-court settlement. Because of that, the settlement amount is confidential.

Settlement talks, however, have not panned out between Landers and Wabash Center, said Landers' attorney, Matt Laydon. A bench trial will be held Feb. 2 and 3, then pick up again Feb. 9 and 10, before Judge Thomas Busch of Tippecanoe Superior Court 2.

Landers and McAninch were married from 1984 and 1999.

In the lawsuit, Wabash Center claims that Landers knew about McAninch's "illicit income" while they were married and that she further used that knowledge to her advantage when they were going through a divorce.

Their divorce decree stipulated that McAninch pay most of his after-tax income to Landers for years after the divorce -- possibly more than $300,000.

Essentially, Wabash Center is arguing that Landers received measurable benefits from McAninch's crimes and that she has no legal claim to the funds.

Laydon said Landers disputes this.

"She did not know that it had taken place -- not until everyone else learned after his death," Laydon said. "She had no idea that this was going on."

Landers' defense will focus on two key arguments: Wabash Center should have spotted the financial irregularities well before October 2009 and, because of that, the lawsuit falls outside a six-year statute of limitations.

"Connie is not guilty of preventing them from discovering what was going on," Laydon said. "What it comes down to is that Wabash Center should have known sooner."

Through an audit completed after McAninch's death, Wabash Center acknowledged that it lacked internal monitoring.

McAninch was able to write checks to "S&S Enterprises" because, at the time, he signed checks using stamps that bore the signatures of Wabash Center's board of directors.

Wabash Center now requires all checks to be manually signed by two people.

Though Wills' settlement amount is confidential, the lawsuit alleged that Wills had access and benefited from about $3 million, made up of the fake payments to S&S Enterprises.

According to a claim that Wabash Center filed in Tippecanoe Circuit Court in February 2010 against McAninch's estate, a combined $489,184 in checks from Wabash Center was paid to S&S Enterprises between July 1991 and October 1995 -- roughly $122,000 a year.

Those payments then increased significantly. Between July 1996 and October 2009, checks made out to S&S Enterprises totaled $3,977,946 -- roughly $305,000 a year, according to the claim.

Kealey said Wabash Center has been able to recover some money, but he did not have a total.

Landers, meantime, has a federal lawsuit pending against Wabash Center and Wills based on life insurance payouts, Layden said.

Please read complete article at link below:


http://www.jconline.com/article/20120127/NEWS03/201270323/Trial-set-Wabash-Center-s-claim-against-late-CFO-s-ex-wife?odyssey=tab%7Ctopnews%7Ctext%7CFRONTPAGE

Editor's note: Alice R. Gore Estate value about 1 million dollars: Alice R. Gore, deceased, a disabled 99 year old ward of the Probate Court of Cook County, Judge Kawamoto’s courtroom was hours away from ending up in the Cook County Morgue. Alice's estate was depleted by probate court parasites and there was reportedly no funds to bury her. Her loving family paid for the burial expenses so that Alice would not have to suffer the indignity of being stacked like an Auschwitz inmate in the morgue. This Shark wonders what a complete audit of Alice's estate would reveal?  Lucius Verenus, Schoolmaster, ProbateSharks.com
KawamotoDragon.com