CAMDEN, Maine - The former head of a Midcoast charity, who alledgedly embezzled more than $4 million from the organization, has agreed to reimburse his former employer.
Rusty Brace has admitted to breach of duty, fraud and conversion of money belonging to United Midcoast Charities, as part of the settlement of a civil lawsuit.
Meantime, a federal investigation into Brace's misconduct continues, with charges expected to be filed soon.
The scheme came to light last fall, shortly after Rusty Brace ended a 17-year run as head of United Midcoast Charities in Camden. New CEO Steve Crane asked a board member, and frequent donor, for a contribution. The donor told Crane he'd just written the charity a check for $35,000. But UMCC had no record of the contribution.
Crane says he later learned that Brace had deposited the check, and many, many others over the years, into a private bank account for his own use. UMCC quickly filed a civil lawsuit against Brace.
"You know, I think by the end of the day here, we're going to get back a substantial amount of the money Brace stole from us," Crane says. That total, says Crane, now stands at just over $4.6 million.
A motion filed in court Wednesday lays out what Rusty Brace has agreed to do to resolve the lawsuit filed against him. Jay McCloskey, a former U.S. Attorney, is UMCC's lawyer.
"He will admit his conduct - that is, the fraud and conversion of UMCC donation checks and his breach of duty as former president of UMCC," McCloskey says. "And he's agreed that the court will enter judgment against him on all counts and for the full amount that he took."
McCloskey says Brace will also be responsible for paying back the $4.6 million. "Mr. Brace has agreed to sell his properties that he owns and to turn over all the money in his bank accounts, as well as certain items of his personal property, to satisfy the judgment."
Brace and his wife own several properties. They include homes in Rockport and Rangeley, a cabin in Washington and a commercial building in downtown Camden, worth $1.6 million.
Cases like this one, notes McCloskey, often end up with plaintiff's recovering little to nothing. UMCC, he says, should get back much of what it lost.
Steve Crane says the charity is eager to get that money back where it belonged in the first place. "Eventually, that money will get back out into the community. And that's what it was intended for and that's what we will do with it."
Rusty Brace is still the target of an ongoing federal investigation. Criminal charges in that probe are expected to be filed soon.