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Tribe's controller testifies in Michael Thomas theft case

New Haven — Michael Thomas, working long hours and traveling extensively in his role as chairman of the Mashantucket Pequot Tribe, was "extremely busy" between October 2007 and April 2009 — so busy, in fact, that some of his personal matters "fell between the cracks," Thomas' one-time chief of staff testified Monday.

"He had a lot of responsibility," Jeffrey Wosencroft testified during the first day of Thomas' trial on federal theft charges.

Among the things Thomas and his staff neglected, Wosencroft said, was a requirement that Thomas file timely expense reports documenting the chairman's use of a tribe-issued American Express card. The card was to be used only for business expenses, and Thomas and the other tribal councilors to whom such cards were issued were supposed to file so-called "reconciliation reports" within 30 days of the tribe's receipt of monthly credit card statements.

Wosencroft, a childhood friend of Thomas, said the filing of the reports was "a random process" and that he and Thomas did not typically complete the reports within 30 days.

Later, the tribe's controller, Donna Capoverde, who testified under a court order of immunity from prosecution, said that during the period in question, Thomas never filed an expense report and never reimbursed the tribe for personal expenses he charged to the American Express card he had been issued.

The government alleges that Thomas embezzled or "misapplied" more than $100,000 from the tribe in the form of personal expenses charged to the credit card. He has been indicted on one count of theft from an Indian tribal organization and two counts of theft concerning an Indian tribal government receiving federal funds. Thomas has pleaded not guilty.

According to testimony, the tribe receives about $3 million a year in federal funding.

The trial is to resume today in U.S. District Court, with Judge Janet Bond Arterton presiding.

Capoverde, who is also the managing director of the tribe's finance department, testified that a 2005 tribal resolution signed by Thomas himself limited tribal councilors' use of the American Express cards to business purposes and required they submit the reconciliation reports. Any nonbusiness expenses charged to a card "inadvertently" were to be repaid immediately, or the amount would be deducted from the councilor's paycheck, Capoverde said.

A Nov. 14, 2007, memo in which Capoverde alerted Thomas to the credit-card restrictions was entered into evidence.

Under cross examination by Thomas' federal public defender, Paul Thomas, Capoverde said such memos were directed regularly to all tribal councilors. She also said no deductions were ever made from a councilor's paycheck — including Michael Thomas' — to pay for personal expenses. Paul and Michael Thomas are not related.

"So that was the part of the policy that you ignored," Paul Thomas said.

"Yes," Capoverde responded.

Assistant U.S. Attorney Christopher Mattei asked Wosencroft about Michael Thomas' personal finances at the time.

"Was it deteriorating?" Mattei asked, referring to Thomas' income.

"Yes, his income was being reduced," Wosencroft said. "Over time, it significantly decreased."

"Was he able to meet his expenses?"

"He was under pressure."

Tax forms entered into evidence showed Thomas' income — "wages, tips and other compensation — plummeted from about $863,000 in 2008 to around $354,000 in 2009.

It is known that Thomas subsequently filed for bankruptcy.

Wosencroft also testified that Thomas was extremely concerned about his mother's health and used the credit card to pay for a limousine service to transport her to and from dialysis treatments. He said Thomas' mother ultimately died of kidney failure.

The government alleges that the personal expenses Thomas charged include some $80,000 in limousine charges.

Another government witness, James Ibrahim, a former limousine driver, testified that he became Thomas' friend while driving him over eight years and that Thomas asked him to drive his mother to her three-times-a-week appointments in New London.

Ibrahim said Thomas paid him a $150 tip for each trip.

The other personal expenses the government alleges Thomas charged on the American Express card include Direct TV and satellite radio service he had installed in a Cadillac Escalade, Internet and cellphone service and other equipment. A tribal finance department employee testified that one of Thomas' charges was at a Victoria's Secret store.



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