Bank of America on hook for $823,777 embezzled from St. Bernard School
Bank of America is contesting a New London Superior Court jury's finding that the bank's negligence enabled a former St. Bernard School employee to embezzle more than $800,000 from the school between 2002 and 2006.
The jury, in a verdict reached earlier this month, awarded the school $823,777 in damages.
"We're very pleased with the verdict and appreciative of the jurors for their service on this case," an attorney for the school, said Michael Colonese of the Norwich firm Brown Jacobson.
An attorney for the bank filed motions this week seeking to have the verdict set aside and the amount of the award reduced. The attorney could not be reached to comment.
St. Bernard, a Catholic school operated in Uncasville by the Diocese of Norwich, filed suit in May 2008 after discovering that a school employee, Salvatore Licitra Jr., had diverted more than $840,000 to an unauthorized account he set up at a Fleet Bank office in 2002. Bank of America acquired Fleet in 2004.
After a forensic accounting, the school referred the matter to state police, who arrested Licitra in July 2007, charging him with first-degree larceny, a felony. Licitra pleaded no contest and was sentenced in September 2008 to seven years in prison.
In its suit, St. Bernard claimed the bank opened an account in 2002 called the "Camp Sunshine" account without the school's authorization or knowledge and failed to disclose the existence of the account through September 2006. The school charged that during that time, the bank deposited more than 1,200 checks into the account that either had no endorsements or "bore restrictive endorsements specifically directing that payment be made to the plaintiff's Operating Fund."
The bank "failed to act in good faith or with ordinary care," the school claimed.
Bank of America argued in court filings that language in deposit agreements that were in effect in 2002 and afterward absolved the bank from liability. St. Bernard claimed the agreements only applied to new accounts, not those opened years earlier. The school's Operating Fund was opened in 1985, according to the school.
Court records show the jury found the school had proved a contract existed between the parties and that the bank breached the contract. The jury found the bank's negligence caused 95 percent of the loss and that the school's negligence accounted for 5 percent of the loss.