Feds Drop Embezzlement Charges Against LR Medical Office Manager

by Arkansas Business Staff  on Monday, Jul. 23, 2012 12:00 am  

In a development that even a veteran defense attorney described as "highly unusual," the U.S. Attorney's Office in Little Rock has dismissed a 59-count criminal indictment against a former medical office manager accused of embezzling more than $610,000.

What's more, the doctors doing business as Practice Management Services Inc. have similarly dropped their parallel civil suit against Lynn Espejo and her husband, North Little Rock CPA Pancho Espejo.

Jane Duke, First Assistant U.S. Attorney for the Eastern District of Arkansas, said federal prosecutors would have no comment on the dismissal of the criminal charges. Little Rock attorney William H. Allen, who represented PMSI just long enough to file the motion to dismiss the civil case, also declined comment.

But Lynn Espejo and her defense lawyer, Richard E. Holiman of Little Rock, say the reason she's off the hook is simple: She's innocent.

"Lynn Espejo is completely innocent of any allegations that she took anybody's money," Holiman said. "When this got started it was a rush to judgment, and we are pleased that the United States Attorney's Office, after further investigation, did the right thing. And we appreciate and know that it was the right thing for the doctors to dismiss their lawsuit."

Lynn Espejo had been indicted by a federal grand jury in March 2011 and a jury trial had been scheduled for May 29. But two weeks before the criminal trial was to start, Assistant U.S. Attorney John E. Bush filed a motion to dismiss the indictment that had originally been brought to the grand jury by federal prosecutor George C. Vena, who has since retired. The dismissal was promptly granted by U.S. District Judge Leon Holmes.

On July 13, Allen asked to dismiss the civil case that had been filed in June 2011, and his motion was granted the same day by Pulaski County Circuit Judge Jay Moody.

While both cases could theoretically be refiled at a later point, the only thing currently pending is a forfeiture action in which federal prosecutors hope to keep $50,700 held in the Espejos' checking and savings accounts at Eagle Bank.

‘A Nightmare'
During the 14 months that she was under indictment, Lynn Espejo made no public statements. But after being contacted last week, she issued a lengthy statement to Whispers:

"This entire situation has been a nightmare that, as a U.S. citizen, I never dreamed could happen to us. I would like to thank our friends and family that believed in us, stood beside us and supported us throughout this ordeal; [Pancho Espejo's attorney] Pat James, who is an exceptional attorney and was a godsend in the civil case; many, many other attorneys who stood by us and gave us exceptional advice; my husband's employer and other staff members, who as always showed the quality of people they are by caring about their employees and their families and by doing so without passing judgment. We will always be appreciative.

"To those people that just saw me out and, without mentioning what was going on, showed their support with a hug, kind word, pat on the back or a smile - you will never know just how much those kind gestures meant to me. I would also like to thank Kristy Burton at the Pretrial Probation Office for being fair, kind, professional and non-judgmental; she is an asset to that office.

"To a very wise Assistant U.S. Attorney, whom I will not name, I would like to say I thank you from the bottom of my heart. Without your honesty, ability to stick to fact and ignore fiction, your desire to get to the truth of this matter with open eyes and ears, your will to do the right thing and to uphold your outstanding ethics, I would not be sitting here today. I have the utmost respect and gratitude to you and your office.

"Thanks to my husband for loving me and standing by me when times could not get much worse. I love you.

"And last, but certainly not least, to Rick Holiman, my legal counsel, my advocate, and one of the hardest-working individuals I have ever been around, there are no words to express my gratitude. You are a true jewel in the legal profession. Your ability to get to the truth, to fight for your client, to tear the evidence apart, to take hard stands, and to take on the role as therapist at times has been the shining light that has gotten me through this mess. I owe my freedom to you, your hard work, and your never ending pursuit of the truth.

"Lastly, thanks to [Editor] Gwen Moritz and Arkansas Business for caring enough to update this story."



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