The Free Press, Mankato, MN

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September 10, 2011

Embezzler sentenced to 41 months

MANKATO — A former Le Sueur man who pleaded guilty to a federal embezzling charge in March has been sentenced to more than three years in federal prison.

Delroy Joseph Sand Jr., 63, also was ordered to pay nearly $650,000 in restitution to the retirement funds of his former Hecla employees. Sand was the trustee for the savings plan. He also was the owner of Hecla, which provided adult foster care, operated group homes and offered mental health services to customers throughout Minnesota. The company’s assets are in foreclosure.

Federal guidelines called for a sentence between 41 and 51 months in prison. Sand received a 41-month sentence, but his attorney, Manny Atwal of Minneapolis, asked Judge Paul Magnuson to consider a sentence below the minimum recommended.

Prosecutors accused Sand of stealing the money from Hecla retirement funds to support his lifestyle, a gambling habit and to buy race horses. Atwal said Sand is denying those allegations.

Sand used the money keep his businesses operating after an assisted living facility he built in Le Sueur started losing money as soon as it opened. The facility cost more than $3 million to build, but never had enough residents to keep it running, Atwal said in a sentencing document filed in federal court.

“For two years, Mr. Sand was able to keep things afloat and pay his staff,” Atwal said. “This was accomplished, in part, through the money he stole from the retirement plans.

“He put all the money that was coming in into a pile. He first paid his employees, then paid the expenses to run the programs and then the mortgages. However, there came a time where there was just no money.”

Sand has been living in a halfway house in Minneapolis since he entered the guilty plea. There were complaints from staff there that he hasn’t complied with the facility’s rules. Atwal said Sand was also denying those allegations. He said the problems occurred after Sand had a stroke that left him physically disabled.

The federal charges against Sand were filed in November 2010. That was about a month after he pleaded guilty to a felony perjury charge in Le Sueur County District Court.

In that case Sand admitted to falsely claiming to be the spouse of Judy Fischer. While claiming to be Fischer’s spouse, he settled her estate after she died in 2005.

Fischer’s children had believed their mother had been married to Sand for 20 years, but learned after her death that he had been married to another woman in Stearns County since 1969.

After learning about Sand’s real wife, Fischer’s son, Scott Rodning, called authorities to report Sand had sold his mother’s house to him for $690,000. Rodning said he should have been the person settling his mother’s estate because Sand wasn’t legally married to her. That resulted in the perjury conviction.

Sand is also facing a felony theft charge in Stearns County for allegedly taking out a loan to buy a van, but then keeping the cash. Bank officials called authorities because the van was supposed to be used as collateral for the loan.

Several civil claims have been filed against property and other assets Sand controls in Minnesota. Those claims total hundreds of thousands of dollars.

The federal sentence requires Sand to pay a minimum of 50 percent of his prison earnings, with a minimum of $25 every three months, toward restitution. Once he is released from prison, he is required to pay a minimum of $300 per month. At that rate it would take Sand well over 100 years to pay the full amount.

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