A former employee of a Madison Valley AIDS hospice embezzled more than $300,000 over a four-year period by forging supervisors' signatures on checks and depositing them in her private bank accounts, according to a complaint filed by the King County Prosecutor's Office last week.

The nine-page document details how Shelley Wood, a former accountant at the Bailey-Boushay House and its affiliate, Virginia Mason Hospital, diverted $53,000 from the hospice's petty cash. She wrote over $263,000 in company checks to herself, her husband, Gary Wood, her daughter, Tracey Wood, and to Geometrix, a company registered to Wood and her husband, prosecutors say. (Why do AIDS organizations attract embezzlers? In 1998, the Northwest AIDS Foundation took a $300,000 hit when an employee embezzled funds.)

Police say Wood, 51, admitted to the fraud while being questioned. If convicted, she faces 10 years in prison. Gary and Tracey Wood have hired their own lawyers, and refuse to comment on the case.

Bailey-Boushay is one of the premier AIDS hospices in the nation; this June, the hospice will celebrate its 10th anniversary. State Representative Ed Murray of Seattle, one of Bailey-Boushay's strongest supporters, has called its administrator, Christine Hurley, "one of the pioneers in this city in giving help to the marginal community."

Hurley said Bailey-Boushay finance staff detected Wood's scheme in September 2000 and, with the help of law enforcement, began an investigation that ended with the complaint filed last week. Wood, charged with 20 counts of theft, will be arraigned in King County Superior Court on February 13.

Hurley said almost all of the $319,000 was recovered through Virginia Mason's insurers, but Wood's alleged looting of company coffers has inspired the hospital to reform checks and balances in its bookkeeping procedures.

"Through this experience, we've had an opportunity to do a lot of overhaul in our financial system," she said. "Bailey-Boushay does good work, so when something like this happens it is distressing on a lot of levels."

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