Accusers say ex-college trustee conned way to riches, influence

With his Ivy League degrees, corporate successes and alumna wife, Tom Delanty seemed like a Whitworth College fundraiser's dream: an untapped well of wealth with ties to the campus.

He claimed to manage 38 different companies — to be a CEO, a CFO and a CPA, pulling in $60,000 a month. He had a waterfront mansion in Everett, beach homes and a Hawaiian condo.

He sent his daughter to a private school, to dance, piano and voice lessons and to all the Disneyland parks.

After donating $225,000 to Whitworth, a private liberal-arts college in Spokane, Delanty was named to the college's board of trustees and sat on two influential committees.

But had officials at Whitworth checked, they would have found he was a felon and a fake.

Other than his business degree from Dartmouth, most of Delanty's claims of financial success and fiscal pedigree were fictitious. According to court records, he didn't have a Harvard graduate degree, didn't manage a corporation with "nearly $1 billion in annual revenue," was never a personal assistant to Mrs. Nelson Rockefeller, nor was he the Australian Businessman of the Year or a certified public accountant.

In fact, when Delanty arrived in Washington state in about 1984 and began doing taxes, he was still on probation for a federal mail-fraud conviction in Oregon.

King County prosecutors, two elderly women and a number of attorneys involved in civil lawsuits filed against him since the 1990s say Delanty funded his lavish lifestyle by stealing from the trust funds of the elderly and vulnerable who trusted him with their finances.

Delanty, who left the Whitworth board in 2005 after a falling-out over his donations, is now facing first-degree-theft charges and civil suits in King County Superior Court. Senior Deputy Prosecuting Attorney Lynn Prunhuber said the investigation is continuing for other possible victims.

In addition, Delanty's business practices continue to be investigated by private attorneys for two other former clients.

"He was convincing," said Nancy Huegli, 91, from whom Delanty is accused of stealing more than $150,000 since 2000. "Of course, I believed him."

Delanty, 51, did not return phone calls from The Seattle Times. His attorney Richard Hansen admits that as a felon Delanty could not legally serve as trustee of the estates he was managing, but he claims Delanty didn't know that.

Delanty has been accused of serving as trustee of at least four estates of people not related to him and transferring money from one estate to another. He used the funds to finance loans to himself and other people, put himself on the titles of real estate, charged money to take his name off the titles, and horribly complicated the deeds, according to court records in civil lawsuits filed against him over the past 16 years.

Hansen said that Delanty "has done a lot of philanthropic work for institutions and for individuals and, if anything, he's gotten too involved in their lives. ... He was getting accolades for his work until now. Now everyone is trying to get money back from him."

Oregon fraud case

Delanty was working as a lumber trader in his native Oregon in 1980 when he created documents with the name "Delanty Co." He used them to sell lumber belonging to his employer to an out-of-state buyer, according to federal court documents.

In 1983, he pleaded guilty to one count of federal mail fraud and served 60 days of a one-year prison sentence.

After his release, Delanty was doing taxes and giving financial advice while on parole in Washington state when he met Michiko Vincent and Gertrude Stostad, both widows, and Charlotte Stirkins. He later met Kathleen Moore and Nancy Huegli, also widowed. Delanty also met Seattle businessman Frank Chen, who named Delanty as trustee of a fund to benefit Chen's son, who has cerebral palsy.

They would claim they lost hundreds of thousands of dollars to Delanty. Stostad, Stirkins, Moore, Huegli and Vincent, all elderly women, would try to reclaim their losses in lawsuits, two of which are active now. Vincent filed hers Thursday in King County Superior Court, alleging that from 1996 on, Delanty diverted her assets into clandestine accounts held in his name or the names of family members.

Huegli, whose losses from 2000 to 2005 were the only ones within the statute of limitations for prosecution, contacted the police. In June, 29 counts of theft were filed against Delanty, who pleaded not guilty.

In college's inner circle

When theft charges were filed, no one was more surprised than his former colleagues on the Whitworth College board, who learned about the case through the news media. They knew Delanty as an affluent businessman devoted to the small, Presbyterian-based college. No one knew of his past felony conviction.

With 40 people on the board of trustees, it would be difficult to do background checks on everyone, said Greg Orwig, Whitworth spokesman. Delanty never had access to any of the college's funds, Orwig said.

Delanty and his wife had been donors back to 1987, at that time giving $570 a year. They became so ingrained into Whitworth's philanthropic circles that many administrators and board members defended Delanty — even after learning of the theft charges.

The Delantys were friends with board members and Vice President Kristi Burns and her husband. The Burns used the Delantys' Hawaiian condo. They went to Mariners games and dinners with them.

To others at the college, Delanty sent Christmas cards featuring a photo of his family on a visit to Thailand and wrote of his trip to see Tiger Woods play golf, the difficulties of his $100,000 home-remodeling project and the $1.2 million appraised value of his Seaside, Ore., beach home.

"Everything was money to him. He'd walk down the street appraising everything," said Seattle dentist Joseph Zimmer, who had a brief business partnership with Delanty.

Whitworth Trustee Shaun Cross, even after hearing of the theft charges and lawsuits, praised him for his business savvy and success and his willingness to help raise funds.

Over the years, Delanty contributed some $225,000, including a $35,000 music collection belonging to his uncle. Delanty pledged an additional $100,000 to the college's new science center, a pledge that was never fulfilled.

As Delanty was moving up in Whitworth social circles, his wife's longtime neighbor, Nancy Huegli, a widow whose children lived some distance away, was struggling to manage her financial affairs. When Delanty offered to help Huegli with her taxes in 1997, she said she believed that as the husband of an old family friend, he'd be a safe choice.

King County Superior Court charging documents say Delanty alienated her from her long-time stockbroker and began writing checks — some with her preauthorized signature, others with her name forged. From 2000 to 2005 he allegedly stole more than $150,000 from Huegli, according to charging documents. That amount included $80,000 in checks payable to himself and his wife, daughter and businesses. He claims Huegli wrote the checks to the Delanty family as gifts, which Huegli denies.

Today, Huegli lives in residential care out of the Seattle area. She is fearful, doubts her judgment, and feels angry and embarrassed. She can live on her remaining assets, but nothing compensates for the greater loss of her belief in people and her presumption of safety, says her family. In addition to the criminal case, she has filed a civil suit against Delanty.

As Huegli became increasingly upset with Delanty, he was falling out of favor at Whitworth after he reneged on his $100,000 pledge for the new science building, saying he disliked the way the endowment funds were managed.

He further slipped from grace when he asked to be hired to manage the endowment fund and criticized Tom Johnson, the fund manager, according to correspondence between the board and administrators. When Delanty went ignored, he demanded a full accounting of funds he donated and threatened to sue the college if it didn't comply.

Delanty also railed about being listed in a college brochure as being among donors who gave between $25,000 and $250,000. "I'm insulted every time I look at it," he wrote to Burns, the college vice president. "It saved face for the cheapskate trustees who only contributed $25,000 to $50,000 ... . Donors, even me, have egos."

Delanty's fall from grace and 2005 resignation left colleagues upset.

Burns, who had defended him to college administrators and was sad to see him go, sent Delanty a message saying the news of his departure made "me sick to my stomach." Harvey Bolton, a trustee, told Delanty in an e-mail that "you have done such a wonderful job on the endowment and on the board ... this is a real loss for the board and the college."

Court arraignment

He'd made many claims of employment as a business executive, but when he was arraigned in King County Superior Court, neither Delanty nor his attorney could tell Judge Michael Fox what he did for a living. Nor did they offer any comment when the prosecutor read an e-mail Delanty sent to Zimmer, the dentist, asking for $150,000 to invest because he was "too tired to look for old ladies."

Delanty was released on $100,000 bail. His attorney argued that when the court froze his bank accounts, it made paying his legal fees impossible and his $12,000-a-month in household expenses difficult to meet.

But since then, Huegli's attorneys turned up a bank account Delanty never disclosed, court records show, and subpoenaed some $700,000 in checks Delanty wrote on the account after all his assets were frozen by the court in March. Although he told the court in August that he didn't have money for groceries, the subpoenaed checks include $9,000 for gardening, $20,000 in home-remodeling fees and checks to a family friend in Oregon.

The friend, Connie Musch-Taylor, 64, describes Delanty as a "wonderful, warm and loving person" who has been helping her with her finances.

Nancy Bartley: 206-464-8522 or nbartley@seattletimes.com