Even though bank and accounting records show that the family's lifestyle — including the purchase of expensive cars, horses and recreational vehicles — was more than four times his $100,000 annual income, it was not until a client complained to a regulator about inconsistent account statements that the scheme was uncovered.
Ms. Laursen, 50, who has re-entered the work force in an effort to support her four teenage children, said she learned of the embezzlement for the first time a few weeks after her husband's death, when she visited the Hantz offices to discuss the sale of 25,000 shares of company stock.
"I was not aware of any of it," she said. "When I found out, I was in shock."
Ms. Laursen is alleging that Hantz Financial should have uncovered the scheme long ago, said James Johnson, who runs an eponymous law firm in Auburn, Mich., and represents her.
"We're looking into what Hantz did or did not do in terms of supervising its employees," he added. "How could this have gone on for so many years, and what kind of autonomy do these people in the outer offices have?"
In the scramble to assign blame, it is unclear how much responsibility will fall to Hantz Financial, a brokerage firm established in 1998 when John Hantz, former head of the Detroit region of Minneapolis-based American Express Financial Advisors Inc., left that company along with 185 fellow reps to start his own firm.
Hantz Financial, which now has 250 reps and another 40 certified public accountants working out of 22 offices in Michigan and Ohio, has evolved into a diversified financial services firm offering investments, insurance products, mortgages, health care and retirement services.
Hantz Financial maintains that it is not liable for missing client money that never entered the Hantz system.
"There is no way for us to police money that doesn't go through our internal system," Mr. Shay said.
He said that, in terms of the brokerage firm's responsibility for Mr. Laursen's embezzlement activity, the actions went beyond the terms of Mr. Laursen's job description.
"We employed Michael Laursen, but we didn't employ him to steal money," Mr. Shay said.
On his lawyer's advice, Mr. Hantz would not comment.
The embezzlement remains as one of the few details of the case that is not in dispute.
Even Ms. Laursen acknowledged: "Clearly, he was doing the wrong things."
According to court documents, Mr. Laursen, who joined Hantz Financial in 1998, started skimming money from clients by cashing checks made out to "HFS" in a personal checking account set up as Henry Firearm Services.
He then transferred the embezzled money from the HFS account to his personal account at a different bank, the documents allege.
The crime first came to light when a client filed a complaint with the Financial Industry Regulatory Authority Inc. of New York and Washington requesting information about descrepancies in statements he received about investments he had made in products sold by Hantz Financial.
Mr. Laursen was notified of the Finra complaint March 7, and according to the police report, he accidentally shot himself two days later while alone on a pistol range in Midland.
As part of its effort to recover assets from the Laursen estate and the widow, Hantz Financial is alleging that the death was a suicide.
"Whether the death was an accident or not doesn't take away from the fact he took the money," Mr. Shay said. "But it would be relevant if anyone claimed he didn't take the money."
In addition to going after the insurance and retirement assets by accusing Ms. Laursen of participating in the embezzlement, Hantz Financial lawyers are also trying to gain access to the assets by claiming that Mr. Laursen used stolen money to pay for the life insurance and to fund his retirement account.
This is where the case gets tricky, according to Mr. Johnson, who claims there is a definite distinction between money Mr. Laursen legally earned and stole.
"They are clearly going to have to show the distinction between the embezzled money and the money Michael Laursen earned, because even Hantz doesn't dispute that he earned his salary," Mr. Johnson said.
There are currently no trial dates set for the lawsuits, and both sides have said they are open to some kind of settlement.
For Hantz Financial, the motivation to settle and likely absorb some of the embezzled losses would be to avoid a jury trial pitting a brokerage firm against a widow and her four kids.
"It won't have good jury appeal," said Ken Springer, president of Corporate Resolutions Inc. in New York.
"Shame on the company; they should have had better controls in place," he added. "You have to wonder who Michael Laursen reported to."
E-mail Jeff Benjamin at email@example.com.