Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: MONDAY, August 8, 1994 TAG: 9408090044
SECTION: VIRGINIA PAGE: A-1 EDITION: METRO
SOURCE: By MICHAEL STOWE STAFF WRITER
DATELINE: HORSEPASTURE NOTE: BELOW LENGTH: Long
Like grieving relatives, many folks in this small Henry County community are hurt and confused.
All they want to know is, why?
Why would Susan Stone, their loved and trusted neighbor, allegedly swindle millions of dollars from the trust accounts of a generous, but vulnerable, textile heiress?
"I guess that just about sums it all up," said Joel Barnes, who grew up in Horsepasture with Stone and Stone's husband, Harry. "It just don't make a whole lot of sense to me. Susan and Harry both are just plain, good people. I just don't understand, and I don't think anyone else does, either."
People were stunned in May 1993 when federal investigators linked Stone to the disappearance of nearly $1.5 million from accounts belonging to Lucy Pannill Sale. Up to $5 million later was discovered to be missing.
They weren't really surprised that Stone, 44, was living off money from a huge benefactor, only that she might be stealing it.
With expensive cars and lavish vacation homes, the Stones did little to hide an extravagant lifestyle that many people assumed was legally bankrolled from a trust fund.
"I've thought for years that Susan Stone was living off Lucy Sale's money," said Joe Cobbe, Sale's recently named accountant. While he didn't think it was right, he said, he didn't think Stone was doing it illegally.
Sale is the daughter of Pannill Knitting Co. founder William Pannill and the widow of E.A. "Mike" Sale, the first president of Sale Knitting Co. Pannill was later sold to Sara Lee Knit Products, and Sale Knitting has become Tultex Corp.
Stone managed Sale's money for years and became a valued friend to the elderly woman. The widow, now 86, would often send Stone out to bestow anonymous gifts, not unlike the old television show "The Millionaire."
"When Susan Stone came knocking at your door, it was like heaven shining on you," a source close to the case said last year when the investigation began.
Stone graduated from Drewry Mason High School in 1967 and went to work at Piedmont Trust Bank three years later. She was named a trust officer in 1984, a position she held until she was fired last year.
Ann S. Hanes, who worked in the trust department with Stone, said Stone was an outstanding trust officer.
"She went out of her way for her customers," Hanes said. "She took them home with her. No pun intended."
Hanes, who now lives in Winston-Salem, N.C., said she was shocked to hear that Stone might have masterminded an embezzling scheme.
"I just can't say enough good about her," she said. "I just don't see it."
Federal authorities say that Stone began illegally taking money from Sale's accounts in June 1985. At the time, she was running for clerk of the court in Henry County, a job that paid $51,000 a year. Stone made $42,000 at Piedmont in 1993.
During the campaign, Stone said she was the only candidate who managed "in excess of $31 million in assets each day."
Stone lost the election, finishing seventh out of 12 candidates, but she didn't lose her appetite for big money. For the next eight years, she used Sale's money to buy six cars, a Jet Ski, a South Carolina vacation home, a house in Florida for her daughter and numerous stocks and bonds, according to court records.
Current or former employees at Piedmont, except for Hanes, are reluctant to talk publicly about Stone.
However, some people who know Stone or who have been involved in the case said that, while she might have been sweet and caring to her friends and customers, she was more abrasive when dealing with bank employees.
"She had the attitude of `I've got one of the biggest accounts at this bank, and don't question what I do,''' one said.
Others described her as highly energetic, a hard worker who was always in a hurry but always willing to bend over backward for her customers.
Hanes agreed that Stone was assertive, but said her former friend was well-liked by bank employees.
Federal authorities said Stone would take money from Sale's trust fund and deposit it in one of 30 accounts in 12 banks.
In January 1993, when a routine bank audit discovered that huge amounts of money were missing from Sale's multimillion-dollar accounts, Stone persuaded her to sign a letter saying it was all a gift, according to court documents. After interviewing Sale and deciding the letter wasn't legitimate, federal authorities froze Stone's assets and searched her house and bank office looking for evidence.
For the next year, locals waited for a federal grand jury to indict Stone.
What most people didn't know was that Stone signed a plea agreement in June 1993, admitting that she took up to $1.5 million from Sale's account - though federal authorities now say she took a lot more. Piedmont Trust has filed a $5.5 million claim with its insurance company.
After a 14-month investigation, the U.S. attorney's office filed bank fraud charges and unveiled Stone's plea agreement last month.
It was the second major scandal to hit Martinsville-Henry County in the 1990s. In December 1992, Linda Powell, head of the local drug task force, was convicted of selling cocaine.
As far as community interest goes, however, the Stone case - possibly the largest bank embezzlement in Virginia history - was much bigger.
One woman said that, in the Martinsville area, publicity in the Stone case rivaled coverage given to the Tonya Harding-Nancy Kerrigan incident last winter.
Without intending to, Barry Nelson, general manager of several family auto dealerships in Martinsville, has been able to turn the intense public interest in the Stone case into a marketing tool.
Nelson paid between $80,000 and $90,000 last month for six luxury cars and a Jet Ski that Piedmont confiscated from Stone.
The vehicles - two Jaguars, a 1991 Stealth, a 1991 Jeep Cherokee and two exotic kit cars - are on display in a dealership showroom, and Nelson estimated that between 50 and 100 people stop by each day to gawk at the cars.
"Those are people with no intention of buying," he said. "In a small community like this, everyone knows everyone's business. It's kind of like Peyton Place."
Nelson said he's got a waiting list of buyers for the cars; but before selling the fleet, he's going to move them around to all of the family's dealerships.
Stone was scheduled to plead guilty to bank fraud charges today, but late Friday her court date was continued until Aug. 22. She will be sentenced in about three months. Assistant U.S. Attorney Jennie Waering estimated that Stone will serve from two to six years in prison and be fined between $5,000 and $100,000.
The ``good life'' is gone, and the Stone family must start over.
The bank has seized all their assets, including the family's Horsepasture home, which had a swimming pool and four-bay garage.
Until she is sentenced, Stone and her family are living in Henry County with relatives.
Despite the intense media attention, Barnes said Stone hasn't gone into hiding.
Two of the main centers of social activity in Horsepasture are the Old Country Store - which is really a modern convenience store and deli owned by Barnes - and Horsepasture Christian Church.
Barnes said Stone and her husband still come into his store several times a week. Someone else said, "she's in church every time the doors are open."
Horsepasture Christian has stood behind Stone even though the bank has filed suit against the church seeking the return of $375,000 it claims was illegally taken from Sale's trust accounts and given to the church.
Numerous attempts to reach the church's chairman, John Bradshaw, were unsuccessful. He has said in the past that the church will return the money if it's proven the money was stolen.
Locals in Horsepasture are standing behind Stone, but seem embarrassed to talk about the case - like a dirty family secret.
"She was just a nice neighbor," said Barbara Payne, who lived across the street. "I don't care to comment on anything else."
A worker at the 58 Beauty Shop said few customers want to talk about Stone's case.
"It's hurtful, and it's very upsetting," she said. "And while you can't condone something like this, you can't turn your backs on them.
"These people are caring, and you just don't throw your friends out the window," she said.
Marshall Mundy, Stone's attorney, issued a statement last month saying Stone wants to remain a contributing member of society. It doesn't look like anyone here - at least among the family's friends and neighbors - will hold any grudges.
"She's still one of us," said one church member.
by CNB