Appeals court upholds embezzlement conviction

A mid-level state appeals court has upheld the conviction of a Lake Clear woman found guilty of stealing tens of thousands of dollars from her former employer.

In May 2010, Rebecca Farnsworth was convicted of second-degree grand larceny and sentenced to three to nine years in state prison. She was also ordered to pay $150,000 in restitution to Adirondack Audiology Associates, where she worked as business manager from May 2004 to February 2008.

Farnsworth appealed, and the matter was heard by the state Supreme Court’s Third Judicial Department, which issued its ruling last week.

Farnsworth had argued that the verdict was against the weight of the evidence in the case, but the appeals court justices disagreed.

Keith Walsh, the business’ owner, testified that he gave corporate credit cards to Farnsworth, his three other audiologists and himself, and told them they were only to be used for business purposes. The other audiologists corroborated that testimony and said they never used their cards for personal expenses, court papers state.

Walsh acknowledged that he and his wife occassionally used their business credit card for personal expenses, to increase the “points” they accumulated on it, but paid the expenses back. Walsh also made several personal loans to Farnsworth to help her with construction of her home and help her resolve her mother’s debts, court documents state.

“The people offered unrefuted testimony that, during the course of her employment, (Farnsworth) charged over 400 personal expenses and cash advances to the corporate credit card, amounting to approximately $80,000, and also accrued $21,000 in personal gasoline expenses and nearly $6,000 in personal telephone expenses that she paid with Adirondack’s funds,” the ruling states. “Testimony was also offered that (Farnsworth) had unilaterally increased her salary from $35,000 in 2004, to $43,000 in 2005, to $58,000 in 2006, and to $61,000 in 2007, and was on course to earn $74,000 in 2008.”

Court records show Farnsworth didn’t deny the allegations, but she testified that the business’s owner, Keith Walsh, told her the corporate credit card could be used for both business and personal expenses. She also said it wasn’t theft because she planned to repay what she owed, even though she didn’t know how much money that was. Court documents also show Farnsworth listed more than $95,000 as debt owed by her in Adirondack’s books as accounts receivable, which she said was evidence she never attempted to conceal her use of the business’ money.

An accountant who testified for the prosecution said, “People seeking to perpetuate a fraud on a business by personal use of a corporate credit card sometimes attribute these charges as accounts receivable in an effort to hide them as legitimate business expenses,” according to the ruling. “Further, although defendant stated her intention of repaying the debt, she made no payments between the time of her termination and the trial and, a few days after the discovery of her expenditures, she was found shredding documents in her office.

“Given the substantial evidence that defendant engaged in the excessive use of Adirondack’s resources for her personal expenses without authorization, we find that the verdict is not against the weight of credible evidence.”

Farnsworth, who was released on parole in September of last year, had also argued that her sentence was harsh and excessive, but the appeals court said it found “no cause to warrant a reduction” in her sentence.

Contact Chris Knight at 891-2600 ext. 24 or