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Mille Lacs County, Minnesota

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Smith convicted in federal court




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Embezzler sentenced
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October 21, 2008

Superseding Indictment

May 20,2009

Instructions to the Jury





from the Mille Lacs Messenger

Posted: Friday, October 16, 2009 12:00 am

Mille Lacs Academy director resigns

Mille Lacs Academy Executive Director Paul Smith was convicted Oct. 15 by an Oklahoma Federal District Court on charges stemming from his employment with Marie Detty Youth and Family Services Center, Inc., of Lawton, Okla., from 2001 to 2004.  Sentencing is scheduled for late January, 2010.

Six of 10 counts against Smith — those alleging mail fraud — were dropped on Wednesday by District Court Judge Robin J. Cauthron, according to Smith's attorney, Mack Martin. On Thursday, a jury convicted Smith on the remaining counts involving embezzlement of money from an employee pension plan and making false claims to investigators. The charges were made in federal court because the money Smith embezzled came from federal grants.

Martin said consideration of an appeal is premature. Smith will have 10 days after his January sentencing to file an appeal.

David Hutchinson, the CEO of Nexus, the Minnesota nonprofit corporation which operates Mille Lacs Academy, responded to Smith’s conviction with this statement:

“Paul Smith joined Nexus in 2007 as executive director of Mille Lacs Academy after a thorough background investigation.  At that time, we found that both the Marie Detty organization and the Oklahoma Health & Human Services Department had investigated the same transactions on which the conviction is based, and that both investigations had exonerated Mr. Smith in 2004.

“Paul Smith has always exhibited excellence in his duties as director of Mille Lacs Academy.  When we learned of the Oklahoma indictment, our position was to let the justice system take its course.  However, we want to assure our referral sources and the public that we maintained vigilant oversight and supervision of all financial and operational matters at Mille Lacs Academy since learning of the indictment and that the independent financial audits performed during Paul’s leadership at Mille Lacs Academy have shown no irregularities.

As a result of this conviction, Paul submitted his resignation, and Nexus has accepted it, effective immediately. Patrick Rookey, Vice President Clinical Operations, will serve as interim director.  A search for a permanent replacement is already underway.”









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