Aunt Admits $52,000 Theft From Trust Fund

A Laguna Hills woman pleaded guilty Wednesday to charges that she stole the trust fund of the AIDS-infected nephew she had raised since he was a toddler and agreed to pay him $20,500 in restitution.

Under a plea agreement, Deborha Jean Franckewitz, 36, also faces a nine-month jail sentence for stealing $52,000 from Channon Phipps, an 18-year-old hemophiliac who in 1985 became the first HIV-infected student in California to sue his way back into school.

After her arrest Dec. 11, Franckewitz returned $16,000 of the money to Phipps. She had already spent $36,000 when authorities caught her in a Laguna Hills motel.

Outside court, Phipps merely shook his head as Deputy Dist. Atty. Joseph D’Agostino explained the plea agreement to him. The 18-year-old said he harbors no ill will toward the aunt who raised him since his first birthday and whom he once called “Mom.”

He denied giving Franckewitz any money to spend and said he wanted a restraining order against her and her family so they “wouldn’t bother” him once she is released.

“I just want her to leave me alone,” Phipps said of the woman who eight years ago successfully forced the Saddleback Unified School District to take the then-fifth-grader back into school. “I just want my money back.”

Franckewitz was able to produce receipts or paperwork to show prosecutors that she spent about $15,500--on Phipps and herself--with the nephew’s permission, D’Agostino said Wednesday. Under the plea agreement, she still owes Phipps $20,500.

Franckewitz faced as much as three years in prison if she had gone to trial and was convicted. If Superior Court Judge John M. Watson accepts the plea agreement May 28, Franckewitz would likely be released soon after that hearing because of time off for good behavior. She has been jailed since Dec. 11.

Phipps was born a hemophiliac to teen-age parents struggling with alcohol and drug problems. At age 11 he learned that he had contracted the virus that causes AIDS through blood products provided by UCI Medical Center. He became ill with AIDS last year.

Phipps sued the hospital, and in 1989 settled for $125,000. After legal expenses were paid, the remaining money, about $78,600, was placed in a trust fund until he turned 18 last Nov. 1.

Phipps claimed that on the day after his birthday, Franckewitz convinced him that the government had liens against the money and that to protect it, he should put the fund in an account in her name, according to court records.

Together, the two withdrew $52,000 and immediately placed it in that account. They also opened checking and savings accounts for Phipps with $700. The balance was used to pay for Phipps’ new car.

Phipps told investigators that he was tricked by his aunt and wasn’t sure what he was signing. He also told them that she stole his car and closed out the $52,000 account in mid-November.

After her arrest, Franckewitz returned the car.

D’Agostino said Franckewitz currently has about $9,000 that she will immediately turn over to Phipps. How the remainder of the debt will be paid is not known and will be discussed May 28, when Franckewitz returns to court for her sentencing.

Franckewitz “told me that $9,000 is the only money that she has in the world at this point,” D’Agostino said. “She has no other money, and there’s no other explanation for what happened to (the stolen fund). It’s gone.”