The government of Finland is suing a New Rochelle business executive to stop her from using bankruptcy court to avoid paying back embezzled funds.
Business Finland USA Inc. claims that former regional administrator Jaana Colangelo stole nearly $5 million, according to an adversary proceeding filed Dec. 14 in U.S. Bankruptcy Court, White Plains.
“Colangelo was able to accomplish this theft,” the complaint states, “through an elaborate scheme where she concealed and hid the true and correct financial statements and records from Business Finland and instead submitted … fake and altered financial statements and records.”
Business Finland is a government-owned nonprofit corporation that helps Finnish businesses compete globally.
Colangelo was hired in 1997 as an administrator in the New York office, according to the complaint, and eventually was entrusted with sole authority over the checking account.
But by spring 2007, Business Finland suspected that she had misappropriated funds. A few months later she went on sick leave for a purported incapacitating injury, and by the end of the year she was fired.
Business Finland says it discovered that Colangelo stole $4,820,782 from 2011 to 2017.
She concealed the scheme by turning in bank statements she had created that omitted fraudulent transactions, according to the complaint, including millions of dollars directly transferred from Business Finland’s U.S. bank account to pay her personal American Express credit card bills.
She charged at least $402,000 for improvements on her New Rochelle house, according to court records, $100,000 for a family vacation to southern France, $85,000 for a country club membership, and $38,000 for jewelry, and for private school tuition for four children.
Business Finland sued Colangelo and her husband, Ronald, in Westchester Supreme Court in 2018, for fraud and other charges.
In 2021, Supreme Court Justice William J. Giacomo issued a partial summary judgment against Colangelo, for $522,733, on a charge that she had forfeited her right to the wages and other compensation she had received.
The trial on the remaining charges was scheduled to begin this past May 15. On May 9, Colangelo filed for Chapter 7 bankruptcy protection, automatically freezing the Westchester court case.
Colangelo declared $8,619 in assets and $705,043 in liabilities.
She listed a $69 deposit in a checking account, $75 in cash, and monthly income of $4,124 from Social Security and family support payments.
She noted that she and her husband are getting divorced.
The house on Wilson Drive that they bought for $410,000 in 2002, listed for sale at $775,000 in July, and took off the market in August, according to online property records, was valued in the bankruptcy petition at $0.
The petition acknowledges the $522,733 court judgement.
Business Finland argues that bankruptcy court may not release Colangelo from the court judgement because she had obtained money and property by fraud, defalcation, and willful and malicious injury.
Efforts to contact Colangelo for her side of the story failed.
Business Finland is represented by Eastchester bankruptcy attorney Julie Cvek Curley and White Plains attorney Michael R. Wood.
