Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, June 30, 1994 TAG: 9406300134
SECTION: VIRGINIA PAGE: C1 EDITION: METRO
SOURCE: MICHAEL STOWE STAFF WRITER
DATELINE: LENGTH: Long
William B. Poff, senior partner and head of the litigation section of Woods, Rogers and Hazelgrove in Roanoke, said he does not know why the U.S. attorney's office in Roanoke has not indicted Susan Stone, a former trust officer at the bank.
"I don't know what they are doing," he said. "They've already got a plea agreement."
Ruth Plagenhoef, an assistant U.S. attorney, said her office could not comment on the case. She did not deny that a plea agreement had been reached.
Though he was not certain of the specifics, Poff said he thinks the agreement calls for Stone to plead guilty to embezzling between $800,000 and $1.5 million from the bank.
Calls to Stone's home were not answered, and a call to her attorney was not returned.
Pleading guilty to the lesser amount could reduce any prison sentence by as much as 13 to 16 months.
Plagenhoef, while not commenting on this specific case, said federal sentencing guidelines call for a sentence of 24 to 30 months when a person with no criminal history is convicted of embezzling between $800,000 and $1.5 million.
A person convicted of embezzling $5.5 million to $10 million could face 37 to 46 months in prison.
Plagenhoef said such sentences could be reduced by six to nine months if the individual accepts responsibility for the crime.
It has been more than a year since FBI agents searched Stone's bank office and her home in the Henry County community of Horsepasture for evidence linking her to the disappearance of millions of dollars from the account of a wealthy heiress.
An FBI affidavit originally alleged that $1.5 million was missing. But in a claim to its insurance company, the bank named Stone and reported the amount at $5.5 million - which would make it the largest bank embezzlement in modern Virginia history.
The affidavit alleged that Stone used the money not only to lead a lavish lifestyle well beyond the means of her $42,000-a-year salary, but also to give generous gifts to churches and, Poff said, to buy a home for the daughter of one of her co-workers.
The bulk of that money was taken from the trust accounts of 86-year-old Lucy Pannill Sale, daughter of Pannill Knitting Co. founder William Pannill and widow of E.A. Sale, former president of Sale Knitting Co.
Court records filed by Continental Insurance Co., one of two companies representing Piedmont, claim that Stone took money from people other than Sale.
Poff, who is representing the bank in its efforts to recover the money from the insurance companies, said Stone also is suspected of taking $43,800 from four other accounts.
The bank, which has repaid all of the money missing from the accounts, has filed suit against Continental and Progressive Casualty Insurance because they have refused to pay the claim.
Leon "Chip" Lackey, Piedmont's vice president of marketing, said the bank "isn't privy" to information coming from the U.S. attorney's office and was not aware that a plea bargain had been reached with Stone.
But Lackey said it was his understanding that charges against Stone would go before a federal grand jury in July.
"I think the most important thing to us is to get it settled and get it behind us," he said.
Lackey said the bank discovered huge amounts of money to be missing from Sale's trust accounts during a routine audit in January 1993, though courts records filed by Progressive Casualty allege that Piedmont and "one or more of its directors or officers" knew that money was missing "no later than October 7, 1988."
Poff and Lackey said they have no idea where Progressive came up with that date.
There is little doubt that money had been illegally taken from the accounts by that date, Poff said, but he does not think the insurance company has any evidence that top bank executives knew of the swindling scheme.
"That date has mystified us all," Poff said.
Stone, who was fired from the bank shortly after the federal investigation began, had managed Sale's money for years.
Stone served on several nonprofit agencies and made an unsuccessful run in 1985 for clerk of the court in Henry County. She is well-known in the Martinsville area.
Sale often would ask Stone, 44, to bestow anonymous gifts on charities and other causes.
Stone tried to cover up her embezzling by asking Sale to sign forms saying the money was a gift, according to court records.
Poff, who traveled to Hilton Head, S.C., this week to take Sale's deposition, said the elderly woman had complete trust in Stone.
"What this case demonstrates is the vulnerability of the woman," he said.
Stone would deposit the money in one of the 22 checking accounts she had in banks from South Carolina to Virginia, Poff said.
In May 1989, Stone bought a $60,000 home in South Carolina for the daughter of Bob Dunn, another Piedmont Trust employee, Poff said.
The bank has filed suit in South Carolina to seize the home, Poff said. Dunn was forced to retire from Piedmont Trust shortly after Stone left, the bank's attorney said.
Stone also gave money to several Henry County churches, including $375,000 to the Horsepasture Christian Church she attends.
Poff said all of the churches except Horsepasture Christian have returned the money. The bank has filed suit asking the church to give the money back, and it has indicated that it would if Stone is convicted, Poff said.
Poff said Sale, who has suffered a stroke, spends most of her time in bed and cannot remember much that has happened in the past few years.
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