Former owner of Got Memories? faces five to seven years in
prison
San Jose – Michelle Marie Martinez and her husband Oscar Fragoso were found guilty Thursday of embezzling $1.9 million from Martinez’s employer at Pacific States Industries.
Martinez, 30, is the former owner of Got Memories? scrapbooking store in Gilroy and was arrested May 5 on six felony charges, including five counts of grand theft and one count of identity theft for stealing the social security number of her employer’s wife in order to obtain access to his credit card account.
Fragoso, 34, is believed to have assisted his wife by creating a Wells Fargo bank account for her to deposit the funds.
“They both pleaded no contest,” said Deputy District Attorney Dale Lohman of the Major Fraud Unit who handled the case. “She faces a minimum of five years in state prison and a maximum of seven years. He is going to prison for two years – no more, no less.”
Martinez’s former employer will address the court Jan. 10, explaining why she believes Martinez should go to prison for more than five years, Lohman explained.
“I think they did the right thing,” she said, referring to the pleas.
Defense attorneys were unavailable for comment as of press time.
Police records indicate Martinez was embezzling as early as Jan. 2001. She was hired as an executive assistant to the company’s chief executive and financial officers in 2000 and was responsible for general accounting. She had unlimited access to PSI’s databases.
Court documents indicate she disarmed the company’s alarm system outside business hours. One such instance occurred the same day she purchased a BMW.
Martinez had access the victim’s personal and professional bank account information and used the name and social security number of her employer’s wife to obtain a debit card linking her to the couple’s American Express account, according police reports.
Her salary was $41,000, however, she has purchased three vehicles including a 2004 Hummer, a 2005 BMW and a 2002 Ford Expedition, in addition to traveling to Taiwan, Africa and paying for roundtrip tickets for 12 family members to the Bahamas that was scheduled to depart this month.
In 2002, Martinez opened Got Memories? and one year later purchased a home in Gilroy with an outstanding loan amount of $433,000.
The victim took title to Got Memories? in April, and then sold the store to San Jose residents Wensday Wagner and Thomas Everett in May. It reopened in June as You Got Memories.
“The claim for restitution is in the vicinity of $1.9 million when all the dust has settled,” Lohman said.
Martinez’s employer became aware that unauthorized activity was happening to his accounts when he was notified by San Jose National Bank that his account was overdrawn. After contacting American Express he found charges made against his credit card, which he did not recognize. His name was the only one on the account.
Fragoso and Martinez will be back in court Jan. 10 for sentencing.
“They both are going to prison, it’s just a question of how (long) for her,” Lohman said.
