Oconto County farm auction theft: Couple to avoid jail time by paying restitution
OCONTO – As long as they keep working and paying off more than $273,000 in restitution, Leroy and Mary Beechy will stay out of jail.
The Shawano County couple — initially charged with failing to turn over $375,000 in auction proceeds — were granted two years of probation by Judge Jay N. Conley at their sentencing Thursday, June 27 in Oconto County Circuit Court.
Because of the sheer amount of money involved, Conley said incarceration was warranted, but he grudgingly held off.
“They are working hard right now,” he said. “I want to keep them working, keep them paying restitution.”
Conley said if the Beechys miss a $1,500 monthly payment over the next two years, he will consider ordering county jail time as a condition of probation.
“I think it’s actually unfair that these defendants are not being sent to jail, but to send them to jail is going to frustrate victim’s rights and the payment of that restitution,” Conley said.
Defense attorneys told Conley the couple were in deep financial trouble with their dairy farm and handled their auction business accounting poorly.
The couple last month pleaded no contest to counts of felony theft of more than $10,000 in a business setting and misdemeanor charges of issuing a worthless check and theft by false representation.
As part of a plea agreement, Conley withheld a finding of guilt and approved a deferred judgment on the felony charge, which will be dismissed if the couple repay the money. The agreement means they will remain under the jurisdiction of the court for the next 15 years while $1,500 monthly payments are made.
Should they not repay the money as scheduled, the Beechys could be sentenced on the felony charge to state prison for up to 10 years.
On Thursday, they paid $101,500. If that had not been paid, Assistant District Attorney Robert Mraz would have recommended that the Beechys serve consecutive terms of nine months jail on each of the misdemeanor charges.
As it was paid, Mraz asked Conley to withhold a sentence on the charges and grant two years of probation.
“This case has always been about an auctioneer’s responsibility to his client,” Mraz said.
The money, he added, “was held much longer than 24 hours, and that was done so the Beechys could pay their own personal, private debts and expenses.”
The case stems from an auction held Nov. 11-12, 2015, when Marion-based Beechy’s Dairy Cattle Auctions LLC sold livestock and equipment at what was then Nerfarms LLC’s property on Oconto County A in the town of Little River. The auction produced $655,775 in gross proceeds, of which $590,725 was due to Nerfarms, according to the criminal complaint.
Beechy collected $577,234 after costs and commissions and issued a check to Nerfarms for that amount on Dec. 17, 2015. However, the check was not honored because of insufficient funds.
Following a demand for full payment, Nerfarms received $100,000 on Feb. 9, 2016, and $102,000 on March 9, 2016, leaving $388,725 unpaid. It’s not clear why the final amount of restitution due — $375,234 — is different.
Nerfarms LLC filed suit against Leroy Beechy and his company April 7, 2016, seeking the remainder of the money. Conley granted a default judgment July 13, 2016.
Leroy Beechy’s attorney, Kurt Ellison, and Mary Beechy’s attorney, Peter Rotter, noted that the couple have never disputed the debt.
“That’s a reflection of their character and their desire to see it paid,” Rotter said.
Ellison said Leroy Beechy had long acknowledged he owed the money and wanted to repay it but could not.
“And now, through the help of family and with this (deferred judgment agreement), they’re going to work their you-know-whats off to get this done,” Ellison said.
According to the criminal complaint filed against Mary Beechy, over the period of Nov. 12 to Dec. 31, 2015, there were 102 automatic withdrawals by three creditors totaling nearly $147,000. Another $201,000 was transferred from their business account to the couple’s personal account at their bank over the same period.
Four cash withdrawals, totaling $6,400, were made from Nov. 19 to Dec. 9. They also issued 23 checks for just over $317,000, but only made deposits of $166,519 in November and December.
Rotter said the couple didn’t initially intend to steal from the farm’s owner, James Nerenhausen.
“But one definition of intent is to take actions that are practically certain to have a result, and that was this case, and they should have known going in (that) putting money into a personal account — especially when other lenders were taking money out of that account electronically, where they had no say in whether it was going to happen — and it was something that was practically certain to lead to this result, and it did,” Rotter said.
“They continued to try to pay their debts and make everybody happy; it was absolutely impossible for them to be able to do so,” he said.
Ellison told Conley that “predatory lenders” took advantage of the couple’s lack of business skills. Many of the loans were apparently at high interest, Rotter added.
Conley expressed concern about whether the Beechys will be able to keep making the payments for many years, considering their other debts.
Ellison said he and Rotter will be addressing that with the lenders “so that we can ensure by the way we handle this, that (the Nerenhausens) will get their money.”
Rotter, who noted that the debt can’t be discharged by bankruptcy, urged Conley not to impose jail time for either Leroy or Mary Beechy, so they can continue to work full time and make restitution. He added they are no longer in the auction business or dairy farming.
“They are not the kind of people who renege on their debts,” he said. “They get them paid, and that’s what they’re trying to do.”
Leroy, 48, and Mary, 47, declined to make a statement to the court.
Conley said the couple knew the client would be due proceeds from an auction and should have had a trust account to hold funds rather than commingling funds.
“(You) ended up creating a horrific financial situation for the Nerenhausens, and they’re out a ton of money, and they’re expected to just wait patiently for that money over the years,” Conley said.
Not ordering a jail term “on its face seems wrong,” especially when young people who break into cabins and steal beer are incarcerated, he said.
“(But) sending them to jail upsets what I think is a very fragile apple cart. I don’t even know how realistic this deal is going to be. I don’t know if the wool is being pulled over our eyes; I don’t know what their ability to pay 1,500 bucks a month is.”
The only reason not to send the couple to jail, he added, is so they can work and pay off the debt.
“If restitution is not going to be paid, if the Nerenhausens aren’t going to be made whole, the Beechys should do some significant jail time,” Conley said.
Conley decided to impose and stay the maximum sentence of nine months in jail on each misdemeanor count, to be served consecutively.
Conley required each defendant to maintain employment and make required restitution payments while on probation, and he assessed them each court costs of $546 and $400 in DNA surcharges. He granted a defense request allowing them to leave the state for work.
Leroy Beechy, who was first charged on June 1, 2017, lives in rural Marion at the same location where his company was based. Mary Beechy listed the same address when she was charged on Oct. 10, 2018, but her address was changed a few weeks later to Bonduel.
FOR MORE OCONTO COUNTY NEWS: Check out our homepage
Contact Kent Tempus at (920) 431-8226 or email@example.com.