A police widow who parlayed more than $400,000 intended for the families of fallen NYPD officers into theater tickets, dental care and private-school tuition was sentenced Jan. 14 to two years in prison.
Lorraine Shanley, 69, who was the volunteer treasurer of Survivors of the Shield, a city-based nonprofit, from at least 2010 until 2017, pleaded guilty in September to one count of bank fraud and six counts of subscribing to false and fraudulent individual income-tax returns.
To Repay $500k
According to Federal guidelines, she had faced 27 to 33 months behind bars. But in sentencing her, U.S. District Judge Sidney Stein said he considered Ms. Shanley’s age and that this was her first offense. He also ordered her to repay first $406,851 to SOS and then $103,983 to the IRS.
Before being sentenced, Ms. Shanley, whose husband, NYPD Officer Thomas Shanley, died of a heart attack in 1986 while on duty, said she “fully accepted responsibility” and asked Judge Stein for leniency.
“I pray, your honor, that the court will take into account the good I did at SOS,” the Staten Island woman said. She did not elaborate.
Her attorney, Christopher Nalley, also said Ms. Shanley did not deserve jail time, given that she had never before been charged with a crime and was working diligently to make good on repaying the charity.
“She’s fully aware of her error, her mistakes,” he said. “She wants to make SOS whole.”
Mr. Nalley, who several times mentioned Ms. Shanley’s age, told the Judge he did not see how prison would serve as a deterrent to others.
Judge Stein agreed—to a point. While deterrence was “not a major factor here,” another purpose of criminal justice was punishment for misdeeds, he said.
Widows Bear Witness
Nearly 30 police widows, some of them elderly, a few wiping away tears, attended the sentencing. Four of them addressed Judge Stein before he sentenced Ms. Shanley, among them Mary Beth O’Neill, who co-founded SOS 31 years ago. She called the former SOS volunteer’s transgressions unfathomable, given that most of the charity’s donations come from police officers.
“She has really sullied our reputation,” said Ms. O’Neill, whose husband, Police Officer Thomas Ruotolo, who was shot and killed in 1984 as he and his partner chased down a career criminal in the South Bronx. “There’s no happy ending. This is such a sad situation.”
In advocating for Judge Stein to impose the guidelines’ minimum sentence, Assistant U.S. Attorney Brett Kalikow said that although Ms. Shanley spent some of the embezzled money to help care for her special-needs grandson, she used most it for “personal aggrandizement.”
“Over and over, she was using the charity’s funds as if they were her own,” Mr. Kalikow said. Each of the families for which the funds were designated “was robbed by the defendant’s actions,” he said.
Survivors of the Shield sends annual or biannual checks, ranging from about $1,000 to $3,000, to police widows, with each getting the same amount. It also provides a few college scholarships each year, ranging from $2,000 to $4,000.
During the time Ms. Shanley served as treasurer, Survivors of the Shield received about $1.9 million in donations, nearly all coming from NYPD employees, according to the criminal complaint.
Ms. Shanley, whose brother, niece and nephew are all city cops, was an authorized signatory on SOS’s bank account and credit card and was allowed to use both for the charity’s operations.
Covered Son’s Defense
According to the complaint, she used $63,000 of the money to pay her son’s legal bills after he was charged with manslaughter for killing a Detroit civil-rights activist when the SUV he was driving jumped a West Side sidewalk as he composed a cellphone text.
She also wrote checks for $45,000 payable to family members or made out to others that she then double-endorsed and put into her own accounts.
Her grandson’s $29,000 private-school tuition was paid for with the money she stole, the U.S. Attorney said.
Ms. Shanley forged the signature of another of the nonprofit’s signatories on several of the organization’s checks. She then used those monies to pay for personal expenses, including Barbra Streisand concert tickets and motor-vehicle fines.
‘Don’t Waste Prison Time’
The fraudulent activity was discovered when a new volunteer with the charity was reviewing its tax returns and records.
Following the sentencing, Judge Stein counseled Ms. Shanley to use her prison stint to reflect and do good. “Don’t waste that time,” he said.
And once released, he said to her, “Devote yourself to things you wanted to do without this terrible detour.”
We depend on the support of readers like you to help keep our publication strong and independent. Join us.