The estate belongs to James Beckwith, who on Feb. 20 of last year took his own life. It was the same day the United States Attorney's Office for the District of Vermont filed a civil forfeiture complaint against him alleging he embezzled $440,000 from SVC between October 2012 and January 2013.
No official charges were filed against Beckwith, but a forfeiture agreement was reached between federal prosecutors and his wife, Marjorie S. Daitch, regarding three bank accounts and their home in South Londonderry.
Beckwith had been SVC's chief financial officer and chief operations officer since 2007, and was the college's acting president in 2013 while current president Karen Gross was doing work for the U.S. Department of Education.
The federal complaint alleged that Beckwith had the college write three checks totaling $440,000 to bank accounts he owned -- two of them at Merrill Lynch -- which he used to pay down the mortgage on the South Londonderry home.
According to documents filed in U.S. District Court District of Vermont, Daitch was found to have no knowledge of her husband's fraudulent activities. In October 2013 Daitch agreed that the government was entitled to the entirety of one of the Merrill Lynch bank accounts holding $13,819. She agreed the government could also seize $40,545 of a second account holding $80,000. The government also took the entirety of a People's United Bank account totaling $4,793.
The agreement holds that Daitch would list the home for sale at $1.25 million, of which the government would take $538,617. She has until Nov. 1 of this year in which to sell, otherwise she must seek financing for the government's lien on the property in the amount of $506,000.
SVC's lawsuit lists the $440,000 as damages, saying Beckwith claimed the money was to pay contractors, who last year sued his estate and the college.
The college seeks to hold Beckwith's estate accountable for cost incurred by a lawsuit filed in July by York Street Management LLC, Cerone Development LLC, and SVC Housing Partners LLC against both the college and Beckwith's estate. The developers, which filed their claim in U.S. District Court in Syracuse, N.Y., say Beckwith intentionally scrapped a dormitory project after leading them on for a period of months. The companies claim they lost $3.8 million on the endeavor.
According to SVC, the college still denies legal liability in that case, but has spent over $50,000 defending itself and will incur more legal fees as the case remains pending.
Additional accusations by the college are that Beckwith wrote three checks totaling $110,000 under the guise of paying Hunter Excavating, however the money went to Beckwith's personal accounts.
The suit also alleges that Beckwith told Hunter Excavating that Southern Vermont College was paying for work to be done at his Londonderry home. As a result, the college paid the company $121,135 for work at Beckwith's property. It further claims that Beckwith issued $82,000 in deposits for future work to be done by Hunter Excavating, only Beckwith demanded they be returned. Beckwith arranged for the money to go to him and he never turned it over to the college.
Beckwith was issued a credit card by the college in 2007. The complaint alleges he made $68,000 in unauthorized purchases using it.
While Beckwith was acting president, he fraudulently obtained from SVC a $1,000 per month housing allowance for himself, totaling $12,000, according to the complaint.
The college is also accusing Beckwith of purchasing two John Deere snow blowers, and two John Deere tractors using college funds. One snow blower and one tractor went to Beckwith's home for his personal use. Together the items Beckwith took were valued at $14,639.
The college has filed for a writ of attachment for $1.4 million on the Beckwith estate in order to satisfy its claims should the court uphold them. According to the writ, Beckwith misused over $800,000 in college funds and caused the school to suffer over $500,000 in damages.
A hearing on the writ of attachment is scheduled for April 3 at the Vermont Superior Court Civil Division Bennington Unit.
The college is being represented by the law firm Dinse, Knapp, and McAndrew P.C., based in Burlington. The special administrator for Beckwith's estate is listed as Jeffrey P. Guevin. A response to the allegations by the college did not appear to be on file.
Contact Keith Whitcomb Jr. at firstname.lastname@example.org or follow him on Twitter @KWhitcombjr.