Here's a piece I wrote for the Connecticut Law Tribune regarding a former president of the Mashantucket Pequot Tribal Nation who, despite being a strong advocate for American Indian rights, is now serving a federal prison sentence for embezzling from the tribe:
Michael Thomas had a reputation as a "tireless and effective advocate" for the Mashantucket Pequot Tribal Nation, and he rose to president of the tribal council, a position he held for nine years, despite a difficult childhood. But now, with his conviction recently upheld by the U.S. Court of Appeals for the Second Circuit, Thomas will spend 18 months in federal prison for embezzling more than $100,000 in tribal funds.
It could have been worse for the former leader of the tribe that runs the successful Foxwoods Resorts Casino. When U.S. District Judge Janet Bond Arterton sentenced Thomas, she took into account his advocacy for American Indian rights and gave him a sentence that was more lenient than federal guidelines "to reflect [the] defendant's positive work for the tribe."
Over a two-year period, Thomas used his tribal American Express card to pay over $100,000 in personal expenses. Most of the money Thomas embezzled was spent on a car service he hired to bring his mother to and from her dialysis and other medical appointments, at $450 per trip. He also spent tribal money on Direct TV for his personal residence, Sirius XM Satellite Radio for his personal vehicle and cell phone service for two of his associates, among other expenditures.
Tribal law prohibited the use of the tribal-issued AmEx card to pay for personal expenses. Thomas himself signed that tribal resolution as the council chairman. But Thomas alleged that personal items could be charged on his card as long as they were reimbursed.
Prosecutors countered that Thomas had no way to repay the charges. His personal income was in decline and his personal checking account was overdrawn every month. Thomas also never reimbursed or attempted to reimburse the tribe for any portion of the $100,000 of the personal charges.
He was ousted from his elected position in 2009.
In the latest development, the U.S. Court of Appeals for the Second Circuit upheld Thomas' conviction on narrow grounds last month.
Thomas had been convicted of theft from an Indian tribal organization and theft from a tribal government that received $10,000 in federal funds. He agreed that his intention to repay the funds was not in itself a defense to charges of theft and embezzlement. But Thomas's counsel, Steven Rasile of the Law Offices of Mirto & Rasile in West Haven, argued that Thomas's "intent to repay, when coupled with the tribe's practice of permitting [Thomas] to place personal expenses on the tribe's charge card and reimburse them later could have demonstrated that the defendant lacked the requisite intent to commit the crimes with which he was charged."
The district court held that it was not relevant to the case that Thomas had previously reimbursed the tribe for $159,000 in personal expenses charged to his tribal-issued American Express card, or that Shalida Jones, another tribal councilor, had used her tribal credit card for $36,511 in personal expenses. If the defendant "had evidence that other tribal council members charged big-ticket items, like $80,000 of limo services, and went years without repaying, that's getting closer in comparability," Arterton said. "'From what the government is saying, there isn't any such evidence."
The Second Circuit panel of John Walker Jr., Jose Cabranes and Raymond Lohier Jr. rejected Thomas' contention that his due process rights were violated because he was not allowed to introduce that evidence at the trial.
"Even if the evidence at issue was sufficient to establish that the tribe, in practice, permitted its officials to charge personal expenses to their cards with subsequent reimbursement, such evidence would only have been relevant at trial if Thomas's conduct comported with that practice," the panel said. "Here, it is undisputed that Thomas did not reimburse the tribe for any of the over $100,000 in personal expenses that he charged to his card between October 2007 and September 2009—despite the fact that he was not indicted until January 2013."
Not only was Thomas' defense irrelevant to the crimes he was charged with, but the probative value of the evidence was substantially outweighed by the danger of confusing the jury, the court said.
The panel noted in footnotes that there were two issues of first impression in the case.
The first was whether theft from a tribal government could be prosecuted under a federal law that bars people from taking more than $5,000 in funds from programs that receive $10,000 or more in federal funds per year. While Thomas did not challenge federal jurisdiction over his embezzlement from the tribe, the panel did note that the Eighth Circuit has affirmed convictions in federal court for people who have stolen from a tribal government.
The second issue of first impression was whether a defendant's intent to repay funds can be used as a defense to charges of embezzlement and theft. The panel noted that, while it has not decided directly if a defendant's intent to repay funds is a defense to charges of embezzlement and theft, the Second Circuit has issued an unpublished opinion citing a First Circuit's ruling that "'an intent to return money or property is not a defense to the charge of embezzlement.'"
Rasile, Thomas' counsel, declined comment. Assistant U.S. Attorneys Christopher Mattei and Marc Silverman wrote the brief for the U.S. Attorney's Office in Connecticut. Mattei argued the case before the Second Circuit. That office declined comment as well.
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