State v. Foubion, 964 P.2d 834 (N.M. App. 1998)
Background. Some church treasurers have been charged with embezzlement for misappropriating church funds. In many cases, they insist that they are innocent, and claim that they had no intent to steal anything. But despite such protests they may be convicted of embezzlement in a criminal prosecution, as one church treasurer discovered.
Facts of the case. In 1994 a husband (John) and wife (Mary) became members of a local church. Soon after they arrived, John was selected to be the church music director, which was an unpaid position. Mary was selected to be the church's piano player, for which she was paid $30 per week. A year later Mary was elected church treasurer, which was an unpaid position. As treasurer, Mary's duties were to keep the church's books, deposit money into the bank account, pay the bills, and prepare financial statements for the monthly business meetings.
In 1996 the couple moved to another state. Soon after they moved, the church's pastor was surprised to discover that the water bill had not been paid and the water to the church had been shut off. The pastor and the new church treasurer searched but could not find the church's checkbook. John and Mary had kept the church's checkbook when they moved.
The new treasurer obtained checks and copies of the church's bank statements from the bank. Upon examining the statements, discrepancies were discovered between the actual balance and the balance presented to the church in the monthly financial statements provided by Mary. For example, the December 1995 financial statement showed a balance of $4,134.12, while the bank statement showed a balance of $608.12. The January 1996 financial statement showed a balance of $1,796.52, while the bank statement showed a balance of $399.07.
The discrepancy was due to the fact that Mary wrote eight checks to herself and to her husband for approximately $3,600.00. She wrote five checks in December 1995 in the amounts of $750.00, $1,528.87, $400.00, $200.00, and $150.00, and she wrote three checks in January 1996 in the amounts of $150.00, $300.00, and $200.00. Mary recorded none of these checks in the church's financial records and only one of the checks contained an explanation in the memo line.
The pastor called John and Mary to confront them about the missing money. He spoke with Mary who told him that he would have to speak with John. When John returned the pastor's phone call, he told the pastor that the money had been placed in "certificates of deposit" for the church. When John and Mary were questioned over the phone by a detective, they repeated the same story. In fact, they never purchased any certificates of deposit for the church.
Later, when the police questioned John and Mary, they admitted that there were no certificates of deposit and claimed that the money taken from the church was for past services rendered. They alleged that the church was supposed to pay John $50 per week for his work as the music director. They stated that a former pastor of the church had agreed to this. However, there was no record of such a decision.
John and Mary were charged with criminal embezzlement. At their trial, there was testimony that the church had never taken any action to make either the music director or the church treasurer a paid position. In addition, the church's budget did not reflect any compensation for the music director position. Mary admitted that she knowingly falsified the monthly financial statement prepared for the church to cover up what she had done. John and Mary were convicted on seven of the eight counts of embezzlement. They appealed their convictions, claiming that they could not be guilty of embezzlement since they lacked "criminal intent."
The appeals court's decision. A state appeals court affirmed the couple's convictions. It agreed that to support a conviction for embezzlement there must be proof that the couple embezzled the money with the fraudulent intent to deprive the church of that money. However, the court did not agree with the couple that there was insufficient evidence of such an intent. It observed:
Although they argue that they did not intend to deprive the church of its money, we believe it was reasonable for a jury to determine from the evidence that there was evidence to the contrary. [They] also admitted that they submitted false financial statements to the church, took the church's checkbook with them [when they moved], and lied to both the pastor and the police about what they had done with the money. These lies and misleading actions evidence their consciousness of guilt. From [their] actions, the jury could reasonably conclude that they had the requisite criminal intent to embezzle money from the church. Therefore, we find that there is sufficient evidence in the record to support the convictions.
What this means for churches
Many pastors, church treasurers, and other staff members have written checks to themselves using the church checkbook, for what they consider to be legitimate reasons. As this case illustrates, they may believe that the church "owes" them something for services rendered but not fully compensated. In some cases, they believe they are "borrowing" church funds for an urgent financial need, and intend to pay the church back when they are able. In either case, the "innocent" intention does not prevent the person from being convicted of embezzlement.
Church staff members must avoid taking church funds, without clear authorization, no matter how "innocent" their intentions. In most of these cases, church staff members are forced to engage in acts that "conceal" their theft from others. It is these very acts that often are used to prove criminal intent despite a staff member's claim of innocence.
