Coady Institute’s former finance director pleads guilty to theft, fraud charge withdrawn

ANTIGONISH: The former finance director of the Coady International Institute at StFX pleaded guilty to theft, and had a charge of fraud withdrawn.

James Edward Marlowe of Lower South River appeared in Antigonish Provincial Court today to answer to charges of theft over $5,000 and fraud over $5,000.

Marlowe pleaded guilty to the theft charge and the Crown withdrew the fraud charge. He is accused of misappropriating $223,273 from the Coady Institute.

Last year, StFX announced it was suing Marlowe. Their statement of claim – which was filed in Nova Scotia Supreme Court on August 28, 2018 in Pictou – charged that Marlow created fake invoices from suppliers, requisitioned cheques from the university for those invoices, and then deposited the cheques into his personal account.

In July, 2018, StFX launched an investigation when the school’s auditor notified staff a vendor had received payment for an invoice it hadn’t issued.

Andrew Beckett, StFX’s vice-president of finance and administration, stated in his affidavit the invoices read “hold for pickup” so the cheques wouldn’t be mailed to the vendors. Marlow would then pick the cheques up personally, or have them delivered to him by a staff member.

Despite the clear instruction to “hold for pickup,” the attention of the auditor had been flagged when one cheque had inadvertently been mailed to the vendor.

Beckett interviewed Marlow on July 17, 2018 and informed him of the results of his preliminary investigation.

According to the affidavit, Marlow didn’t deny he created phoney invoices or that he deposited the cheques into his personal account.

“Mr. Marlow’s response was to the effect of ‘you know everything now,’” reads the affidavit.

Two days later, Marlow was fired and the university called in the accounting firm Deloitte to investigate.

A manger from Deloitte found 32 suspicious invoices declaring to be from three vendors. While they didn’t quite look exactly like the legitimate invoices issued by those companies, the invoices had similar templates, numbering and logos of the vendors.

As a way of preserving Marlow’s assets in case a judgment is awarded to StFX in the future, the university obtained an attachment order for $229,023 against Marlow’s property in Lower South River.

The university also asked for punitive and aggravated damages, interest on the amounts of allegedly misappropriated funds, as well as legal costs.

Then on September 27, 2018, Marlowe was arrested without incident, and a few days later, criminal charges were laid. Following his arrest, Marlowe was released from custody on conditions.

Marlowe is scheduled to return to Antigonish Provincial Court on January 22, 2020 for sentencing.