People v. Jennings

Sentry Armored Courier Corporation (Sentry) transported and stored large cash sums and performed related services for clients. John Jennings and other officers of Sentry (defendants), as well as John Finnerty (defendant), a cashier at the Hudson Valley National Bank, were indicted on several counts of second-degree grand larceny and misapplication of property. First, in a repurchase-agreement scheme, Sentry would perform a money-counting service for a client, Chemical Bank (Chemical), and then deposit the money with Finnerty along with the right to invest the money, which was secured by A-rated bonds. After 72 hours, Finnerty would then transfer the original amount to Chemical, leaving the interest in Sentry’s account. As a result, Sentry gained a total of about $17,000 in interest. Second, in a compensatory-balance matter, Jennings took approximately $100,000 from Chemical’s inventory with Sentry and deposited the money into a compensatory-balance account at Citibank. When Sentry tried to withdraw the funds, Citibank refused and froze the account. Sentry returned the inventory to Chemical with a shortage of $97,000. Third, in a misappropriation of insurance proceeds, an insurer had sent Sentry a check representing payment for losses suffered by three of Sentry’s clients due to an armed car robbery. Jennings reimbursed one of those clients for the loss but did not distribute the remainder of the proceeds to the other two clients, instead keeping the excess for himself. All counts were dismissed by the trial court, and those dismissals were later upheld by the appellate division. The state appealed.