CAMDEN, Maine — United Mid-Coast Charities and its former longtime president have reached an agreement in which he will pay the group more than $4.6 million in connection with his alleged embezzlement of funds from the organization.
United Mid-Coast Charities President Stephen Crane announced Wednesday in a news release that Russell “Rusty” Brace admitted to breach of duty, fraud and conversion of money belonging to the charity after his theft of hundreds of donation checks made payable to the charity.
The settlement is for $4,646,636, according to the news release.
In order to partially satisfy judgment, Brace has agreed to sell properties that he owns and turn over his interests in the sale proceeds to the charity. He also has agreed to turn over all the money that he holds in bank accounts as well as his interest in certain items of personal property that will be sold.
Jay McCloskey, attorney for the charity, said that “in order to settle this case, the charity required Mr. Brace to agree to liquidate virtually all his assets and turn over the proceeds to UMCC. At the end of the day, I think the charity will recover a substantial portion of the money that was stolen from it.”
McCloskey said the properties are valuable and that the charity knows how much is still owed in mortgages on them. He said he expects the sale of those properties will recoup a substantial portion of the money owed to the charity.
The organization filed a civil lawsuit in Knox County Superior Court against Brace in October to recover the funds it alleges were stolen. The court placed attachments on Brace’s properties so any sale would need to receive the approval of the charity, McCloskey said.
Brace and his wife own a home in Rockport, a home in Rangeley, a cabin and property in Washington and a commercial building at 21 Elm St. in downtown Camden valued at $1.6 million where his offices are located.
McCloskey said the charity also has settled with The First bank but that terms of the settlement are confidential. The First allowed Brace to deposits checks earmarked for the charity into his own accounts from 2001 until he stepped down as the charity’s volunteer president, the attorney said.
Brace served as board president of United Mid-Coast Charities from 1997 until Aug. 20, 2014, when he stepped down and the board appointed Stephen Crane as his replacement. According to an affidavit filed with the organization’s lawsuit, Crane discovered the embezzlement a few weeks later after talking to a donor whose large contributions could not be found among the charity’s financial records.
No criminal charges have yet been filed against Brace although Brace’s attorney Peter DeTroy has said they will be filed.
U.S. Attorney Thomas Delahanty II said last month that investigations into financial crimes can take a long time, particularly if the misconduct has gone on for a lengthy period.