Former T.J. Martell Foundation VP charged in alleged $3.7 million embezzlement scheme

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Silent Auction items at the T.J. Martell Foundation 9th Annual Nashville Honors Gala at Omni Hotel on Feb. 27, 2017.
Silent Auction items at the T.J. Martell Foundation 9th Annual Nashville Honors Gala at Omni Hotel on Feb. 27, 2017.

Melissa Goodwin, a former vice-president at the T.J. Martell Foundation, has been charged with wire fraud in connection with an alleged scheme to defraud the charity out of $3.7 million.

The Department of Justice alleged the 55-year-old used the foundation's money to purchase expensive and rare alcohols, plane tickets, hotel stays as part of a multimillion-dollar ticketing scheme.

The T.J. Martell Foundation – which battles life-threatening illnesses – long has been a favorite charity for Music Row, often tapping country music's biggest names to serve as performers and honorees for its annual Nashville Honors Gala fundraiser.

The charity started in 1975 when longtime pop/rock music industry executive Tony Martell was looking for a way to honor the life of his 19-year-old son, T.J., who died after a two-year battle with leukemia.

The foundation raises money by soliciting in-kind donations, like concert tickets and memorabilia, from celebrities and then auctioning off those donations for a profit.

The intricacies of the alleged scheme were not clear, but the DOJ said Goodwin used a credit card she obtained in the foundation's name to purchase concert tickets to shows like Celine Dion and Lady Gaga and sporting events like Super Bowl LIV.

Goodwin then provided the tickets to a charity auction house claiming the charity had received them at no cost or a discounted rate, according to federal officials.

To conceal the purchases, she falsified credit card statements by replacing the name of the actual vendor with the name of a different vendor so that the charges appeared to be legitimate expenses, federal prosecutors said. In total, Goodwin concealed over $3 million in fraudulent credit card expenses.

Goodwin also used financial statements to inflate the foundation's assets to make it appear to have more money, preventing anyone from detecting the fraudulent transactions.

David Boling, the spokesperson for the U.S. Attorney's Office of Middle District of Tennessee, said more details on the scheme would be released in future court filings.

In addition, the DOJ alleged Goodwin forged the foundation's CEO signature on checks totaling nearly $1 million.

If convicted, Goodwin faces up to 20 years in prison and a fine of up to $250,000.

The foundation will try to recoup the money

In a statement, Lynn-Anne Huck, T.J. Martell’s interim CEO, said the company discovered the financial irregularities caused by Goodwin 18 months ago.

“We initiated an immediate investigation with the help of an independent forensic accounting firm and legal counsel, terminated the employee and provided our findings to the FBI," Huck said.

“We also undertook a comprehensive review of our policies and procedures and implemented a series of stringent financial controls to prevent anything like this from occurring in the future."

Hucked added the foundation would be launching civil litigation to recoup the stolen funds, which are currently estimated at nearly $5 million.

"It's utterly disgraceful that anyone, especially a trusted employee, would victimize a nonprofit organization that provides vital funds to the fight against cancer," Huck's statement said.

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This article originally appeared on Nashville Tennessean: Former T.J. Martell Foundation VP accused of $3.7M embezzlement scheme