Wrongfully Held, Floyd Brown Awarded Millions, But His Money Is Locked Up

By Elizabeth Leland and Bruce Henderson, The Charlotte Observer (TNS)

Floyd Brown was awarded millions of dollars after being wrongfully incarcerated. But for weeks he couldn’t get money to buy flowers for his mother’s grave.

His $4.5 million has been earning interest while Brown, who is 49 and mentally disabled, lives on $733 a month in Supplemental Security Income benefits.

Contrast his circumstances with those of Greg Taylor and Alan Gell, two former prisoners who were exonerated in recent years and have spent their millions the way they want.

The difference is that Brown has an IQ of less than 60.

His mental abilities are what got him locked up in the first place. A month after he was charged with murder in 1993, a judge ruled that Brown was incompetent to stand trial and ordered him sent to a psychiatric hospital.

In 2012, when Brown was awarded damages for wrongful incarceration, his mental abilities once again defined his future. Brown’s attorneys asked a federal judge to create a type of Special Needs Trust often set up for people with disabilities. It allows Brown to remain eligible for public benefits, including Supplemental Security Income (SSI) and Medicaid.

But it comes with strict guidelines about how his money is spent.

Strictly speaking, none of it could go toward flowers for his mother’s grave. The money can only be used to benefit Brown.

“I miss her,” Brown said about his mother. “When I was locked up, I wasn’t around. She used to worry about me a lot.”

After Brown’s repeated requests for flowers went unanswered, his sister Frances Staton contacted the Observer. Staton, who has been her brother’s legal guardian since 1994, questioned why he has so much money but can’t use it. “The attorneys are getting paid. Why isn’t Floyd?”

Charlotte attorney Tony Giordano, who administers the trust, said, “I’ve got regulations I have to live by. If you read the terms of the trust, it has to be used to enhance his life.”

Eventually Giordano relented. He mailed Brown a $50 check for flowers. Giordano said he will also seek a less restrictive trust that would allow Brown more access to buy things he wants.

Brown’s wish list is short.

In addition to flowers, he said he wants to have a new brick house built to live in with Staton and her family. He wants to buy a $60,000 home for three other siblings. And he wants to give money to his 72-year-old father so he can retire from driving a logging truck.

“I want to help my family out,” Brown said. “When I was locked up, they came and brought me money.”

Under the terms of Brown’s trust, Giordano is authorized to spend money only “for the benefit of the beneficiary” — not for the benefit of anyone else.

Trustees often have to say no to beneficiaries’ wishes, said Aimee Smith, an elder-law attorney in Winston-Salem. “The trustee absolutely can’t just hand this gentleman money from this trust. It doesn’t matter how much he wants to give money to his family members, it just can’t be done.”

Giordano’s decisions, she said, may be conservative, but that doesn’t mean he’s doing a bad job.

“Flowers on his mother’s grave — it sounds ridiculous, but that’s not really for (Brown’s) benefit directly,” said Smith, who had to refuse one trust beneficiary’s request to tithe to his church. “That’s sort of the perfect example of the fine line that we walk as trustees.”

Even with a less restrictive trust, an appointed trustee would serve as gatekeeper to Brown’s money to make sure he isn’t taken advantage of. The trustee would have more flexibility to grant Brown’s requests. But, because of his mental capacity, the trustee would still make the final decision.

“Bottom line for Mr. Brown is that there was really no scenario under which his settlement funds would not be closely watched for his benefit,” Smith said. “Judges are very keen to protect minors and incompetent folks who are going to receive settlements.”

To friends in Anson County, Brown is known by his nickname Spooky. His hair is gray, cropped short, with a receding hairline. He hides it beneath a ball cap. He has a sense of humor and a hearty laugh.

“Floyd loves everybody,” Giordano said. “He’s the gentlest person in the world.”

For years, Brown was a fixture around Wadesboro, often seen hanging out at the courthouse.

Then in 1993, when he was 29, he was arrested in the murder of Katherine Lynch, a retired Anson County schoolteacher. There was only one piece of evidence against him: a six-page confession that SBI Agent Mark Isley claimed Brown dictated.

A judge ruled that Brown was incompetent to stand trial because of his mental disability and sent him to Dorothea Dix Hospital in Raleigh. He was confined there until attorneys Mike Klinkosum and Kelley DeAngelus took on his case. They presented evidence that Brown could not have dictated the confession — it was far too sophisticated.

In 2007, a judge dismissed the charge and set Brown free, agreeing that the confession could not have been given by Brown.

No one else has ever been charged in the murder. Isley was never disciplined — in 2005, he was promoted to head of the SBI’s Medicaid fraud unit. Two local detectives who investigated the case later served time in federal prison for taking bribes from criminal suspects in other cases in exchange for dropping or reducing charges.

Brown was awarded $9.325 million in damages for his 14 years of confinement. Attorneys David Rudolf of Charlotte and Barry Scheck of New York City, who represented him in the civil case, got 40 percent of the award plus expenses.

In December 2012, U.S. District Judge Max Cogburn ordered that the Special Needs Trust be created. Giordano was named trustee. He said he has received about $15,000 a year for administering the trust. Any balance at the time of Brown’s death would go to Brown’s siblings.

Asked why a less restrictive trust wasn’t set up, Giordano said the decision was made jointly among himself, Rudolf and Cogburn. “It was only because he had public benefits (related to his disability); that was the sole motivating reason,” Giordano said. “Hindsight is great.”

To gain flexibility, Brown would forfeit SSI and Medicaid benefits. Staton said there is no reason why her brother, who has millions, should be on public assistance — especially if it’s hindering his access to his money.

“Floyd doesn’t need to be on Medicaid,” she said. “Floyd needs a home.” It will be up to Cogburn to make any changes.

(c)2015 The Charlotte Observer (Charlotte, N.C.), Distributed by Tribune Content Agency, LLC

Photo: Floyd Brown says he wants to use some of his $4.5 million trust to buy flowers for his mother’s grave and build a new brick house to live in. (Davie Hinshaw/Charlotte Observer/TNS)