Clerk held in sophisticated $2m theft

Much of court’s money vanished, prosecutors say

Marie Morey was arraigned in Essex Superior Court. Marie Morey was arraigned in Essex Superior Court. (A. Beaulieu/Eagle Tribune)
By Peter Schworm and John Ellement
Globe Staff / December 4, 2009

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SALEM - For half her life, Marie Morey worked as a low-level accounting clerk, pushing papers in the Probation Department at Lawrence District Court. Covering just four towns, the small courthouse had a cash flow of $2.4 million a year. But in just three years, prosecutors allege, Morey stole a stunning proportion of that money.

She is accused of pilfering $2 million by pocketing countless cash payments to the court and executing a massive embezzlement scheme that, despite its improbable scale, somehow managed to elude detection.

Prosecutors said that Morey, a 38-year-old who had worked in the department since 1990, employed a host of complex accounting maneuvers to pocket an astounding $12,000 a week from 2006 until this summer, when she left work amid sharp questioning from suspicious auditors.

“This case involves a very elaborate, intricate, and sophisticated scheme,’’ Assistant District Attorney Michael Patten said yesterday at Morey’s arraignment in Essex Superior Court.

Morey, a mother of two who declared bankruptcy nearly a decade ago and lives in a working-class neighborhood in Lawrence, pleaded not guilty to the charges and was held on $400,000 cash bail. Her mother, who lives in the Dominican Republic, left the courtroom in tears.

The case has shocked neighbors, who thought of Morey as an ordinary soccer mom and saw no outward signs of wealth or money troubles. But beyond the mystery of her motivations, the scope of the alleged fraud is likely to be a major embarrassment for a section of the court system long criticized for patronage and cronyism with the Legislature, and the case raises serious questions about how an employee could steal such large amounts for so long without being detected.

As far back as 2007, the state auditor’s office raised deep concerns about the court’s accounting practices, singling out the Probation Department.

“Specifically, we found that the Probation Office monthly bank reconciliations were not prepared timely or accurately,’’ the report stated, “and cash journal postings did not always reflect the bank deposits or daily transaction activity entered.’’

The report added that there is “limited assurance’’ that the office’s “records are accurate and assets are adequately protected.’’

Yesterday, officials at the state’s Probation Department and the Supreme Judicial Court declined to answer questions about the case or financial oversight in the office, saying they could not comment on a pending criminal matter. They also declined to say how often the Lawrence court is audited or how the Probation Department could survive financially while sustaining such losses.

Morey’s former supervisor, George W. Corkery, who retired last month as the chief of the court’s Probation Department, did not return a telephone call to his home.

Prosecutors said that Morey was the only person in the department authorized to change entries in the court’s accounting system and that she used her position to manipulate the records and bank deposits. They said Morey’s scheme included six different accounting tricks, including one called a “negative, nonmonetary error reversal,’’ which they described as sophisticated and exceedingly rare. But another was strikingly simple: pilfering courthouse fees paid in cash, then submitting falsified deposits to mask the theft.

“She would pocket the cash and substitute the money orders to make it look like the proper amount of money was deposited,’’ Patten said.

That allegation raises the unsettling possibility that some people who paid fees in cash could have been wrongly punished or even imprisoned if the payments were not recorded, said Keith McDonough, clerk magistrate for Lawrence District Court.

“I wish I could tell you,’’ McDonough said. “It’s a hypothesis, but it’s conceivable’’ that people were punished for missed payments.

Prosecutors declined to say whether payments were properly recorded in court documents before the alleged theft.

William Leahy, chief counsel for the Committee for Public Counsel Services, which oversees legal representation for the poor, said lawyers in the state’s public defenders agency will be checking with clients to see if they have been victimized by the court system as a result of Morey’s alleged thefts.

The allegations arose from a routine audit in February that found discrepancies, triggering a broader investigation. When auditors interviewed Morey, she stonewalled, prosecutors said.

“She was nervous, disoriented, frozen up, and ignored their requests for documents,’’ Patten said. In July she abruptly stopped showing up for work. Investigators soon discovered that the accounting discrepancies stopped as well.

“The paper trail ended with the defendant,’’ Patten said.

In September, Morey was charged with stealing $6,350, but investigators suspected much more was missing.

Prosecutors said they believed that Morey acted alone but declined to say whether the money had been spent. She faces as much as five years in state prison if convicted.

Morey’s lawyer, John Valerio, described Morey as a “lowly accounting clerk’’ and a “homebody’’ who lives modestly and has struggled to pay her bills since leaving her job. She earned a GED and does not hold an accounting degree. One of her children attends private school but on a scholarship, Valerio said.

“I was completely surprised when I heard the allegation of $2 million,’’ Valerio said. “There is a vast, vast gulf between what the government says has happened here and what her lifestyle is.’’

Citing Morey’s ties to the Dominican Republic and expressing concern that Morey might flee, Judge Timothy Feeley set bail at $400,000 in cash. Morey was forced to surrender her passport after her initial arrest. She will be placed on a bracelet monitoring program if she posts bail.

Prosecutors said she had visited the Dominican 30 times in the past four years.

“She could well have stashed money there,’’ Feeley said. “There is strong evidence of embezzlement of large amounts of money.’’

An American citizen born in Methuen, Morey was paid $47,000 in 2008, and her home is valued at $228,800, public records indicate. She declared bankruptcy in 2000 and was divorced in 2003.

On Greenfield Street, where Morey lives in a quiet neighborhood of single-family houses, neighbors said was seen as a soccer mom, and as someone who cared for her property, a blue Dutch Colonial she reportedly brought within the past five years.

In addition to living with her 16-year-old son and 10-year-old daughter - whom neighbors praised for their smarts, their manners, and their compassion for younger children - Morey lives with a man believed to be her fiance. On the black mailbox in front of the home, three names were displayed yesterday: Perez, Garcia, and Morey.

“She seemed like the typical soccer mom,’’ said one neighbor, who would only be identified by her first name, Janet. She said Morey was always shuttling her two children to various sporting events both children participated in.

Neighbors said Morey’s house was recently reroofed, a small front porch made over into a room, and new windows installed. Yet still, they said, they saw no signs that anyone with $2 million in cash was living nearby.

“They weren’t flaunting it,’’ said Russ O’Neil, who lives a few doors away.

Some neighbors also recalled - with suspicion now, in light of her arrest - how frequently vehicles from an international shipping company would appear at the Morey house to pick up large containers.