Business owner testifies in jury trial for bookkeeper accused of embezzlement

Testimony will continue Tuesday in the jury trial of a Taneytown woman accused of embezzling thousands of dollars from businesses while serving as their bookkeeper.

The trial of Dawn Marie Mitchell, 45, of the 3900 block of Old Taneytown Road, is expected to last five days. Mitchell's attorney, Alan Kreshtool, will continue his cross examination of the alleged victim, William Franz, Tuesday.

So far in this trial, she said, the state has admitted 21 exhibits containing thousands of pages of records.

Monday, attorneys made opening statements and Franz testified. Franz employed Mitchell as a bookkeeper for Fun Events Entertainment, Penn Dutch Restorations, Pipe Creek Trading Company and Franz Walcutt, all of which are run out of the same office.

According to Senior Assistant State's Attorney Melissa Hockensmith, Mitchell was hired in 2007 to keep the books for Franz's business ventures until March 2012 when he allegedly learned of discrepancies in the accounts and confronted her.

"He trusted her. That's why he hired her to take care of his books," Hockensmith said in her opening statement.

After receiving a call from his bank, Franz cross-referenced records from QuickBooks, bookkeeping software used by the company and maintained by Mitchell, and copies of checks provided by his bank either online or in paper form, according to Hockensmith.

Franz said that he learned that there were hundreds of dollars in overdraft fees and allegedly found overdraft notices in the trash which he was not informed about.

After finding the overdraft notices, Franz said that at the advice of his bank he looked at each check issued by the businesses and compared them with the register from the bookkeeping software.

Franz said that he found multiple occasions where the registry showed a check written to a regular supplier but the copy of the check with the corresponding number showed that is was made out to Mitchell or made out to cash.

Occasionally, Franz said one of the companies' accounts would be short on funds for payroll so he would ask Mitchell to write a check for cash from another company, take it to the bank and then deposit the cash in the account of the company which was short on funds. For the checks that Mitchell made out to cash which Franz claimed were unauthorized, there was no corresponding deposit of cash into another company's account, he said.

Mitchell was permitted to write checks and to sign Franz's name on checks, he said, but only when the expenditure was authorized. He testified that it is a common business practice to give this authorization to the bookkeeper.

Employees of one of the companies, Fun Events, also had company credit cards to make supply purchases, according to Franz. Mitchell allegedly told the police during this investigation that some of the checks she wrote to herself were to reimburse her for supplies she purchased.

On cross examination, Kreshtool questioned Franz's personal knowledge of what he testified to, including the actual records he looked at when searching for the allegedly unauthorized checks.

Kreshtool asked Franz if he had personally looked through each document while looking for evidence of the alleged embezzlement and Franz said that one of his employees had gone through the bank records and documented suspicious checks, occasionally without his presence.

When asked why he wasn't paying more attention to the books during the course of Mitchell's employment, Franz said, "I wasn't looking for someone to be stealing from me."

Franz also testified on direct examination that one of the unauthorized checks was made by Penn Dutch, which restores antique cars, but it was supposedly written to purchase a car, which Penn Dutch did not do.

On cross examination, Kreshtool elicited testimony that there had been an occasion in which Penn Dutch had purchased a car to use it for parts for a restoration of another. Franz said that the instance was the only time that Penn Dutch had purchased a car, and it was for parts.

After the trial recessed for the day, Kreshtool said that his goal on cross examination was to show that Franz "didn't really know what he was talking about," especially because he testified "emphatically" on direct examination to certain facts, like that Penn Dutch would never buy a car but later testimony showed that it had done so at least once.

Kreshtool also asked Franz why, nearly two years after accusing Mitchell of embezzling money, she was still living in an apartment attached to his business which she began renting shortly after her employment began.

Franz said that he did not have any problems with Mitchell as a tenant and she paid her rent on time, for the most part, so he did not see a reason to evict her.

Kreshtool will resume cross examination of Franz Tuesday and the state has two remaining witnesses, according to Hockensmith: Det. Sgt. Jesse DiMura, the investigating office from the Carroll County Sheriff's Office, and Mike Griffin, the manager for Fun Events who assisted Franz in combing through financial records.