Town sues ex-bookkeeper
LOWVILLE — The town of Lewis has filed a civil suit against its former bookkeeper in an attempt to recover more than $250,000 she embezzled from the town.
The state Supreme Court lawsuit, filed Wednesday in the Lewis County clerk's office by Utica attorney C. Louis Abelove, seeks repayment of $250,348.28, plus interest and legal fees, from Melissa L. Wagner-Dano and her husband, Douglas J. Dano.
When contacted by telephone Wednesday afternoon, Mr. Abelove said he was just heading to a dentist appointment and would be unable to discuss the matter until today or Friday. However, he indicated that a separate lawsuit likely will be forthcoming against Community Bank, since Ms. Wagner-Dano apparently was allowed access to the town checking account without authorization.
Ms. Wagner-Dano, 34, Fish Creek Road, West Leyden, in April pleaded guilty in U.S. District Court, Syracuse, to wire fraud, admitting that she embezzled $400,000 to $1 million from January 2007 through November 2009 from the town, the Oneida-Lewis Dairy Cooperative and the Boonville Farm Cooperative.
She could receive up to 20 years in federal prison and a maximum fine of $250,000 at her sentencing Sept. 21. Restitution also is expected to be ordered by the federal court, but a civil judgment could provide greater access to her assets.
Mr. Dano, who is not involved in the criminal case, was included in the civil case because he was enriched by the stolen money, the lawsuit states.
Ms. Wagner-Dano's parents, Richard D. and Deborah L. Wagner, Lee Center, also were named in the suit because of two property transactions in the past couple of years.
The Danos in January 2009 took title of their Fish Creek Road residence and dairy farm — at which they had lived for several years — from the Wagners for $170,000 and established a mortgage with them, according to Lewis County land records. However, in late December, the Danos transferred title back at no cost, and the mortgage was discharged.
The 220-acre property, including several barns, is assessed for $170,000. However, it reportedly has not been used as an active dairy operation for the past few years, and the Danos no longer live there.
The town's lawsuit claims that at least some of the embezzled money was used to improve the property and increase its value. It adds that the transfer back to the Wagners — made when all parties knew of the pending federal charges — left the Danos "with unreasonably small and insufficient capital and was fraudulent to creditors, including the Plaintiff."
The town is asking the court to annul the property's transfer back to Ms. Wagner-Dano's parents, order the Danos to account for all machinery, equipment, vehicles, farm animals and any other personal property that they sold or transferred over the past three years and restrain them from selling or disposing of any property or assets in their names.
Ms. Wagner-Dano was appointed town bookkeeper in 1998 and was elected town clerk in 2000. While she chose not to run for re-election as town clerk in 2005 to seek the District 10 seat on the Lewis County Legislature, she continued to serve as bookkeeper.
In that capacity, Ms. Wagner-Dano prepared payroll checks for the signature of the town supervisor and created balance sheets and financial reports, the lawsuit states.
However, she also had access to other account information, including the town's checking account number, and town officials claim she used that to illegally withdraw the money.
A civil judgment against Ms. Wagner-Dano for $9,211.51 also was filed this week in the county clerk's office. It stems from a lawsuit filed in May on behalf of Citibank for nonpayment of $8,686.51.
