OAKLAND -- A jury has convicted the former director of an Alameda County anti-poverty agency of three felony crimes for her mishandling of a federal grant but acquitted her of four other charges after a drawn-out trial that began in October.

The jury found Tuesday that Nanette Dillard, who led for seven years the Alameda County Associated Community Action Program, stole from a federal grant and misled the government agency that awarded it.

Found guilty of the same two crimes -- grand theft and false accounting by a public official -- was Dillard's husband, Paul Daniels, who was grants manager for the Alameda County organization. Dillard was also convicted of a third felony earlier in the week for falsifying a memo.

But the couple was found innocent of charges they conspired with one another to defraud the government. They were also acquitted of charges they used the grant money for personal profit and that they misappropriated grant funds to meet payroll for the agency staff.

The five guilty verdicts of 10 charged marked a partial victory for the Alameda County District Attorney's Office, which devoted two deputy prosecutors -- a rarity -- to the complicated public corruption trial that lasted more than four months.

Defense attorneys castigated the prosecution throughout the trial for bringing a "bogus set of charges" hoping some would stick. They said the couple was being scapegoated by higher-level Alameda County authorities for the fiscal and political problems that helped lead to the demise of the anti-poverty agency, known as ACAP.


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The board of 13 politicians that governed the nearly 40-year-old agency disbanded the organization and drew down its funds in 2011 after firing Dillard and Daniels. Dillard later sued for wrongful termination, winning a settlement award of more than $300,000.

Several federal and local public officials testified to jurors, including City Council members from San Leandro and Albany who had served on ACAP's governing board. Many other elected officials and county bureaucrats were subpoenaed but never ended up being called to the witness stand.

The crux of the charges stemmed from how Dillard and Daniels mishandled a federal Assets for Independence grant that was supposed to match the savings of low-income Alameda County residents to help them buy a home, start a business or further their education. The agency had trouble getting the savings program off the ground, but still sought to obtain all of the grant money before it was set to expire.

The jury found that Dillard and Daniels knowingly sent false and inaccurate letters in 2010 to the U.S. Department of Health and Human Services, where Daniels once worked, in order to get the remainder of the grant money.

One of the guilty verdicts was delivered by the jury Monday morning, but Alameda County Judge Allan Hymer ordered the jury to go back to deliberate after jurors reported to him that some confusion arose on the other charges. The full set of verdicts was declared on Tuesday afternoon.

Dillard and Daniels are scheduled to be sentenced on April 18.