Crime

‘Elaborate lie’: Con artist found guilty on 22 counts in Grand Reserve fraud case

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Smaller businesses are hit particularly hard when it comes to wire fraud.
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Smaller businesses are hit particularly hard when it comes to wire fraud.

A federal jury in Columbus has found an Alabama con artist guilty of 22 felonies for inducing the stepmother of Grand Reserve apartments owner Steve Corbett to send her more than $600,000 from the business while the stepmother was its chief financial officer.

Authorities say Dorita Clay of Selma, Ala., took the money she got from Darlene Corbett and either spent it or gambled it away at casinos.

“What the defendant really is, is a gambling addict,” Assistant U.S. Attorney Crawford Seals told jurors in his closing argument Wednesday morning. “She is not just a gambler. She is a flimflam artist.”

Clay was better at swindling than gambling, Seals said: “The defendant is a terrible gambler.” Much of the money was wagered not on any game requiring skill, but on slot machines engineered to take in more than they pay out, he said: “We all know the house always wins.”

Among those testifying during Clay’s trial was a representative of the Pearl River Resort in Philadelphia, Miss., who said Clay in 2015 wagered $1.8 million and lost $1.7 million, and the next year bet around $600,000 and lost about $500,000.

The verdict

The jury’s verdict was announced at 1:50 p.m. Wednesday. Clay was found guilty on 21 counts of wire fraud and one count of conspiracy to commit wire fraud. She was found not guilty on one wire fraud count.

U.S. District Court Judge Clay Land set her sentencing for 9:30 a.m. April 9.

Darlene Corbett was indicted on the same charges as Clay, but her wire fraud counts were dropped after she pleaded guilty to conspiracy, and testified against her former friend.

According to the Sept. 21, 2017, indictment, Darlene Corbett was the chief financial officer for the Grand Reserve from 2009 until she was fired in 2016. Besides The Grand Reserve at Columbus apartment complex, Steve Corbett developed a second one in Alabama, The Grand Reserve at Madison, and his stepmother in the Columbus office managed accounts for both.

Clay played no role in the business, but befriended Darlene Corbett in 2014, and used elaborate tales to persuade her to write unauthorized checks and wire money to Clay between April 30, 2015, and Sept. 21, 2016, investigators said.

The 22 transfers cited in the indictment ranged from a low of $6,465 to a high of $75,000, and averaged about $27,600.

The trial

According to trial testimony, Darlene Corbett said Clay had claimed she was using the money to pay fees and taxes to settle a multimillion-dollar estate in Michigan that involved property she was trying to sell off, and she would repay the funds with a profit once the estate paid out.

Clay also claimed she was to receive a $30 million medical malpractice settlement involving her daughter, but first had to pay attorneys’ fees and court costs and such.

A third scheme was more personal: Steve Corbett was to marry a woman Darlene Corbett disliked, and Dorita Clay claimed the fiancée could be paid off to stop the marriage. After the wedding, Clay told the stepmother the marriage could be annulled, if Clay got more money, and Darlene Corbett continued to pay her.

Darlene Corbett so trusted Clay that even after The Grand Reserve fired her in 2016, she paid Clay $262,000 of her own money, authorities said.

According to court testimony, when The Grand Reserve decided to hire an outside accountant, Clay tried to save Darlene Corbett’s job by calling Steve Corbett and claiming to be an architect from whom the outside accounting firm had embezzled money.

Clay also falsified records and created a fake pay stub from an Alabama hospital to get financing on a $175,000 Range Rover, claiming she earned almost $5,000 every two weeks. She paid $70,000 down, and later paid the vehicle off in cash and canceled the financing.

Federal agents have seized the vehicle.

‘Elaborate lie’

Clay took the witness stand in her trial Thursday, in the federal courthouse in Columbus, and claimed she was being framed with lies.

“The defendant’s statement is a train wreck,” Seals told jurors in his closing. “It’s completely silly…. It’s the bamboozler trying to bamboozle you.”

While on the stand, Clay admitted being addicted to gambling and drugs, and to having previous fraud convictions. Seals called her a “gambling addict and a pill junkie,” and said cross-examining her about her “elaborate lie” was “like wrestling a bar of soap.”

Clay’s defense attorney Robert Wadkins Jr. told jurors Clay was honest about her previous mistakes: “She’s had some problems in the past, that’s for sure.” But she didn’t have to take the stand at all, he said: “Dorita could have chosen not to testify. She subjected herself to that.”

Wadkins said Darlene Corbett stole the money, and prosecutors had not proved Clay knew the transfers were unauthorized — creating enough reasonable doubt to find her not guilty. He noted also that Clay quickly contacted Steve Corbett right after the FBI inquired about the transactions.

Seals countered that Wadkins was stuck with a “mean-spirited client with a bad story,” and the claim Clay didn’t know the transfers were illegal was not credible.

All the money came from Steve Corbett and went to Clay, he added: “Who got Steve’s money? The defendant did. Who spent Steve’s money? The defendant did.”

He noted Clay had neither worked nor paid taxes in 10 years, and cleverly had managed to “bamboozle her way through life” conning money out of others. “What the defendant needs most right now is accountability,” he told jurors. “Let her know she’s accountable for her actions.”

Seals said the total amount Clay fraudulently obtained came close to $1 million, but the amounts cited in the indictment total $607,365, as prosecutors chose to pursue the offenses with the best evidence from the investigation headed by FBI Special Agent Gordon Hurley.

The maximum penalty for each of Clay’s 22 counts is 20 years in prison plus a $250,000 fine.

Corbett faces the same penalty for the conspiracy charge to which she pleaded guilty. Land set her sentencing for 9:30 a.m. Feb. 5.

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