Ex-Key Royale Club bookkeeper Holly Connelly was sentenced July 27 to three years in state prison and 25 years of probation by 12th Circuit Court Judge Thomas Krug for scheming to defraud more than $50,000 from her former employer.
She faced a maximum sentence of 30 years in prison on the first-degree felony.
She pleaded guilty to the charges May 11, and her sentencing was deferred to last week’s hearing, with more than 70 people attending.
During the sentencing, Krug ordered the parties to confer on a “restitution number.” If there is no agreement, he said, a hearing will be held within 60 days to determine Connelly’s restitution.
Choking back tears during her testimony as well as during testimony given by friends and family members, Connelly later showed little emotion when Krug meted out the punishment.
Her prison sentence included credit for time served.
Connelly was arrested in June 2011, and spent approximately 10 weeks in the Manatee County jail, after Holmes Beach police investigated reports from the Key Royale Club about irregularities in the club’s finances.
HBPD learned Connelly had been writing checks to herself, and depositing them into her own account between June 2008 and April 2011. An affidavit filed with the court by former HBPD Detective Michael Leonard states $387,181 was embezzled from KRC by Connelly.
Reports vary regarding how much was stolen, and Krug estimated Connelly was responsible for between $387,000 and $487,000 in improper transactions.
Key Royale Club president Craig Humphreys and treasurer Tim Friesen testified to an additional $99,100 in unauthorized debit transactions by Connelly.
“The number shocks this court,” Krug said during sentencing. “Frankly it’s not only the number, but also the time over which the criminality was committed.”
For a three-year period when Connelly wrote some 370 checks, embezzling $10,000 a month, “there had to be a thought process,” Krug said.
“Some leniency,” he said, went into his decision, due to testimony that husband Phillip Connelly had abused Connelly and their children.
Phillip Connelly was implicated in the embezzlement when, during the investigation, he was observed in one of seven bank video tapes making an ATM withdrawal, according to a KRC member.
“I think the sentence is fair,” said Terry Schaefer, member and past president of the Key Royale Club, Holmes Beach, after the sentencing.
Also after the hearing, John Gallo, a witness who testified at the request of Connelly’s attorney, said the sentence was fair.
The Gallo family was caretaker for Connelly’s daughters after her incarceration, and the court also allowed Connelly to reside with the Gallos in Holmes Beach.
“Our role is to just help make those kids productive, useful members of society,” Gallo testified at the hearing. “If we lose those kids, we all lose.”
He also described Connelly as a good student and housemate, and “a very caring and doting mother.”
The three Connelly children are now said to be living with their father.
Ten witnesses and Connelly testified on her behalf, pointing out her good character, work ethic and desire to provide for her children.
In a soft voice, Connelly apologized for the financial chaos she created, saying she was “even more sorry” for the emotional toll her actions caused, and “deeply sorry” for those whose credibility she’d damaged.
KRC members said Connelly initially denied her involvement in the scheme.
“One question that keeps coming up from all our members is, ‘What happened to the money?” Friesen said.
Humphreys sought to dispel an issue previously raised at a status conference July 24 about members who were alleged to want to write letters on behalf of Connelly, but feared loss of their club membership.
Humphreys said, “this is the furthest thing from the truth.
“We want to attract new members,” he said. The club has 575 members, adding he hadn’t heard from one person with that issue.
Connelly was given broad powers, trusted and groomed for the position that included deposit and debit capabilities, and along with the theft, she falsified bank balances in financial statements, according to Schaefer.
According to club members, the embezzlement nearly resulted in bankruptcy for the club, and the need to raise dues.
“Many of us tried to help her in many ways,” Schaefer said. “We’ve always been a very caring club, and would have made every effort to help her had she asked.”