Using a firefighters' charity as a front, a Wilton firefighter and his wife, a New Canaan financial advisor, bilked an elderly woman out of more $1 million and used the money to build and furnish a Block Island home, according to police.
Following what New Canaan police say is the largest case of fraud in the town’s history, Paula L. Halloran, 39, and Michael Michelsen, 57, were Feb. 25 on felony larceny charges.
They're accused of taking more than $1 million from the now 81-year-old Greenwich woman between 2005 and 2008, officials say.
“This is not a simple case of gift giving or loans or a financial advisor that gave bad financial advice,” New Canaan police Sgt. PeterCondos said. “That’s not what happened. The warrant alleges outright theft.”
Halloran was working at the Smith Barney office in New Canaan during the time the transactions took place, Condos said. The victim had been her client there, according to police. Halloran was dismissed by Smith Barney in November 2008, for “violations of company policy," Condos said.
Smith Barney was not immediately available for comment.
Michelsen, a career firefighter in Wilton, is accused of setting up an account for a charity to benefit firefighters in 2005, two days before the elderly woman wrote her first checks, Condos said. Some of the victim’s money did go to the charity, Condos said.
“They were getting this elderly woman to write checks to them, paying off entire credit card accounts and stuff that really had nothing to do with Paula Halloran’s financial advisor duties to her,” Condos said. “In the middle of all this, which is significant, is that she was having medical issues, cognitive issues, and the checks kept coming.”
Though the couple allegedly bilked the woman out of more than $1 million, the warrant charges them with misappropriating $760,213 — that's because the balance of the money they stole was taken in 2005, and the the statute of limitations on larcency is five years, Condos said.
Condos said credit card records indicate Michelsen spent money taken from the victim.
“Some of the credit card companies actually break down how much the wife uses and how much the husband uses,” Condos said. “He’s used thousands and thousands of dollars and there’s no way he can say he didn’t know what was going on.”
According to police, Halloran met and befriended the victim when she worked for the victim’s husband at US Tobacco, which was headquartered in Greenwich. The victim's husband, who is recently deceased, was not named in the warrant.
Condos said the victim’s family examined the victim’s account after learning that Halloran had been terminated from Smith Barney.
“The family scrutinized mom’s account, basically,” he said. “They were able to uncover the huge transfer of wealth and have all transfers stopped in November 2008.”
The family has filed a civil suit against Halloran, Michelsen and Smith Barney, according to Condos.
Halloran and Michelsen are scheduled to appear March 7 at state Superior Court in Stamford. Michelsen was released after posting $25,000 bond. Halloran was released on a promise to appear. Condos said she is pregnant and due to give birth in early March.
The couple lives in a condominium at 24 St. John Place in New Canaan. Tax records show that Halloran purchased the unit for $415,000 on June 7, 2005.