Posted by Matt Byrne April 13, 2011 10:04 AM

http://www.boston.com/yourtown/news/malden/2011/04/prosecutor_toomajian_used_law.html

WOBURN -- Using accounts tied to his Malden law practice, prosecutors allege that Charles Toomajian, special aide to the Malden mayor, helped "launder" more than $659,000 stolen from a Wakefield company by receiving and writing dozens of checks over more than two years.

Details of the case were released in a four-page statement of facts in the case of the Commonwealth vs. Charles Davis, Toomajian, and Charles H. Breen, entered Monday in Middlesex Superior Court, where Toomajian, 53, and the two others were arraigned on the charges. A statewide grand jury indicted Toomajian last month on counts of larceny, conspiracy, and accessory after the fact to larceny, according to court records, after an initial indictment on lesser, related charges in October last year.

It was unclear how much, or if at all, Toomajian profited from each transaction.

“The investigation into that aspect of the case remains ongoing,” said Steve O’Connell, spokesman for the office of Essex District Attorney Jonathan Blodgett, in an e-mail.

Toomajian pleaded not guilty on Monday, along with Davis and Breen.

"He denies those charges as vigorously as he does the original charges," said Thomas Drechsler, a Boston attorney who represents Toomajian. "I'm fully confident of his innocence."

Davis pleaded not guilty to larceny, falsifying corporate books, and conspiracy charges Monday. Boston attorney Elliot M. Weinstein, who represents Davis, said in a phone interview Wednesday that this latest round of charges was "expected."

"The plea of not guilty indicates that Mr. Davis will challenge these charges," Weinstein said.

Prosecutors charge that Toomajian allegedly used several methods to divert and conceal the large sums of cash stolen from Randstad Professionals, a Wakefield staffing agency where Davis, 44, of Salem, N.H., was formerly an accounting clerk. Davis has been described by the prosecution as a “degenerate gambler.”

While Toomajian allegedly handled only a portion of the total $1.86 million that was said to be stolen, he disbursed it in varying ways to a number of Davis' associates or creditors.

In one 13-month period from May 2008 to June 2009, the prosecution alleges, Toomajian sent checks worth $135,949.72 to cover mortgage and home equity loans held by Joseph Giallanella, identified as one of Davis’s book-making creditors. Giallanella is the alleged head of the gaming arm of an organized crime ring.

In another money laundering setup described in the filing, $112,730.36 flowed through Toomajian’s law office from February 2007 to October 2008, to a Medford realty company where Breen, 38, of Beverly, worked. Breen, an alleged accomplice in the scheme, would deposit the checks in the realty company's accounts and immediately cash them, the filing said.

More payments, totaling $121,384.44, were made by Toomajian between November 2007 and June 2009, directly to an alleged gaming agent, Michael Petrillo, on Davis’s behalf, according to the filing to the court on Monday. In one 54-day period in 2007 between October and December, Toomajian paid out $23,370 to another associate of Davis, Michael Capwell "Collection Agent, Malden, MA," who was betting and paying off debts on Davis' behalf, the filing said.

“Toomajian assisted Davis in the larcenous scheme by laundering the money stolen by Davis through his law office,” the filing said.

“Neither Giallanella nor Petrillo had any business/legal relationship with Toomajian,” according to the filing.

The prosecution alleges Toomajian received 39 "misdirected" checks from Randstad totaling $659,525.53 from Sept. 2006 to June 2009, and wrote 28 more, disbursing the funds to pay for Davis’s gambling debts.

To conceal the diverted funds, Davis allegedly created false entries in Randstad’s corporate books, and at one point even hired Toomajian, who “actually did some minor, insignificant collection work” for Randstad, the court documents said. But Davis allegedly used the relationship to forward more checks to Toomajian for deposit and laundering, the prosecution wrote in its filing.

"There is no legitimate business purpose for Toomajian to have checks as he did collection work which would have not involved dealing with legitimate Randstad clients concerning amounts that were rebated back to them," according to the filing.

To hide the scheme, Davis altered how the checks were written, according to the statement. At Randstad for nearly a decade, Davis was responsible for reconciling company accounts, which often meant collection of money owed to the company or the disbursements of refunds Randstad owed to its clients. To funnel cash to his accomplices, Davis would write a legitimate payment to a Randstad client “care of” a coconspirator, the prosecution alleges.

In a different routing of the stolen money, according to the court filing, Davis created a fictitious account in the Randstad books for Michael Petrillo, and paid him $185,330.13 directly from the corporation’s coffers.

“Davis’ larcenous scheme and false entries of ficticious clients and accounts resulted in a $1,864,353.18 loss to Randstad,” the filing stated.