Wednesday, March 31, 2010

Accused arsonist in Ottawa, Illinois stole more than $100,000 from church

An Ottawa woman, accused of setting two fires last week, appeared in a La Salle County courtroom Friday morning in an attempt to have her $200,000 bond reduced. Instead, she found herself charged with theft of more than $100,000 from a local church. State's Attorney Brian Towne said in court the arson fires were an attempt to conceal or destroy evidence of the crime.
According to court records obtained by The Times, Terri L. James, 42, 1002 Ottawa Avenue, used a credit card without authorization from the First Congregational United Church of Christ, 910 Columbus St., to illegally charge "in excess of $100,000" and "paid said credit card with funds" from the church.
The criminal complaint also accuses James of altering church financial records to conceal the alleged embezzlement. She has been church administrative assistant for several years — editing the weekly bulletin and handling the church's financial affairs.
James is suspected of starting a fire that seriously damaged a South Side home and attempting to set fire to another structure on the city's West Side March 17. She was charged with arson and attempted arson after alert neighbors spotted a similar van at both locations shortly before the fires were discovered.
The Class X felony charge is non-probational and, by itself, could result in a six- to 30-year prison sentence. Combine that possible punishment with the potential consecutive arson sentences, the mother of three and the wife of former State's Attorney Michael James is now facing an aggregated prison term of up to 45 years.
Owners of the damaged home, Carol Kozlowski and Vicki Smith, were fellow parishioners and officers at the church with James. Smith is the chairwoman of the church's board of trustees while Kozlowski is the organization's moderator who conducts various church board meetings.
Smith and Kozlowski who own and operate Income Tax, Etc., in Ottawa, however, an unidentified church official told The Times the two women were not the church's accountants.
The motion for bond reduction was denied by Circuit Judge H. Chris Ryan, Jr. following Towne's presentation of the new charge. James pleaded not guilty to all charges.

Monday, March 29, 2010

East Lyme, Connecticut schools audit lunch program: Probe comes after former director charged with embezzling $335,000

The school board's auditing company, RSM McGladrey, is conducting an audit of the school lunch program following the alleged embezzlement of $334,778 by the former director of dining services. The company that provides school lunches in East Lyme, Chartwells, already agreed
to cover the legal expenses and auditing fees the town incurs. School board members said the district will not suffer any financial loss because of the incident.
"Chartwells has been extremely cooperative with getting everything corrected and putting a corrective plan in place," said school board Chairman Tim Hagen.
The corrective plan from Chartwells outlines its recommended procedural changes. Chartwells is seeking input from the school board regarding the plan. School officials are already suggesting that a monthly review of the school lunch program be conducted.
According to court documents, Beverly Howard, 53, of Westerly, embezzled $334,778.31 from the school lunch fund over three years while working as the dining services director. Chartwells fired her in when its auditors discovered in September that the money was missing.
An arrest warrant says the money was used to support six years of gambling losses that amounted to $381,406 at Foxwoods Resort Casino and $536 at Mohegan Sun.
Howard has pleaded not guilty to a charge of first-degree larceny and is scheduled to appear in New London Superior Court on April 13.
The school lunch program contract will be put out to bid in the next month. The district has used Chartwells as its school lunch provider for more than 10 years.
According to the school district's contract with the company, if Chartwells runs a deficit at the end of the year, the school system does not have to make up the difference. If there is a profit, it's shared between the company and the school system.
It's unclear how much money the district may have lost in profit, school officials said.
Superintendent of Schools James Lombardo said in a previous interview that any money recovered will go back to the district's enterprise fund, which is used for the school nutrition program.

Sunday, March 28, 2010

Former CFO of Danvers school in Massachusetts accused of larceny

The former chief financial officer of a Massachusetts Catholic school has been indicted on charges of stealing more than $80,000 from the school.

The Middlesex district attorney's office announced Thursday that Brian Dalphonse of Goffstown, N.H., is facing charges of larceny and false entry into corporate books.
Prosecutors say that from 2006 to 2008 while CFO at St. John's Preparatory School in Danvers, the 41-year-old Dalphonse wrote checks from school accounts to pay for vehicles and used a school credit card to buy a home theater system and other merchandise not authorized by the school or used for school purposes.
Dalphonse's attorney William Christie called the charges "unfortunate" said his client denies any criminal activity. Christie said he is seeking the results of a school audit and plans to respond.
Dalphonse is to be arraigned April 14.

Saturday, March 27, 2010

Davidsville, Pennsylavnia Police allege former pastor stole $18,600 from charity

A Davidsville man accused of using a fictitious company name to steal money from a charity will answer theft charges in Somerset County. Thomas A. Croyle, 45, of the 2700 block of Carpenters Park Road, waived his right to a preliminary hearing Wednesday before District Judge Joseph Cannoni of Windber.
Croyle is accused of embezzling $18,615 from St. Francis Sharing and Caring Inc.,
124 Stevens Lane, Conemaugh Township police said.
He is charged with 50 counts each of theft by deception, theft by unlawful taking or disposition, failure to make required deposits and receiving stolen property.
The nonprofit charity’s primary program provides cash assistance and food to those who are eligible.
Croyle, a former Mennonite Church pastor, provided cash to clients from 2004 to June 2008.
Police said he instead deposited money into an account of a dummy company, C&A Management Services, which had a post office box in Jerome.
Charges were filed after an investigation by Wessel & Co. uncovered the alleged fraud, police said.
Croyle faces similar charges in Cambria County court.
He is accused of misappropriating $64,484 from Bridge of Hope of the Laurel Highlands from May 2005 until June 2008, forcing the charity to close.
Croyle is free on his own recognizance.

Friday, March 26, 2010

Alleged Embezzlement in Burlingame, California school district

A secretary at a Burlingame School is under investigation for allegedly embezzling $9,000, police said yesterday. The secretary oversaw the SamTrans bus pass fund at Burlingame Intermediate School, but left her job last month, Capt. Mike Matteucci said yesterday.

School officals contacted police on Monday, reporting that $9,000 was unaccounted for, Matteucci said. Police have yet to question the woman and wouldn't release her name. "We want to talk to this lady because she's in charge of the fund, " said Matteucci. Like many schools in San Mateo County, Burlingame Intermediate offers students monthly bus passes through SamTrans for $29, said Christine Dunn, spokeswoman for SamTrans. In Burlingame Intermediate's case, the passes are for sale in the office before school, during recess, lunch and after school.

Thursday, March 25, 2010

Valley Cottage, New York teacher's aide charged with embezzlement

An elementary school teacher's assistant has been arrested on an embezzlement charge involving the theft of more than $13,000 from her union, authorities said Tuesday.

Christine Carolus, 50, of Valley Cottage served as treasurer of the teacher's aide labor group — School Related Professionals Chapter — when the thefts took place, authorities said.
Carolus, who worked at Liberty Elementary School, is accused of writing checks to herself for $12,850 and also withdrew another $800 for reimbursements, the Rockland District Attorney's Office said.
The thefts took place between June 2007 and May 2009, and were discovered after a new treasurer won election and reviewed the labor union's books, the office said.

Wednesday, March 24, 2010

Ladera Ranch, California Church secretary admits stealing $200,000

A former church secretary who pleaded guilty Tuesday to stealing more than $200,000 in church donations will be sentenced to five years in prison, county prosecutors said. Crystina Renee Bock, 38, of Ladera Ranch, used to work part-time as the financial secretary for the Compass Bible Church in Aliso Viejo.
On Tuesday, she pleaded guilty to 62 felony counts of grand theft, according to the Orange County District Attorney's office.
She will be sentenced to five years in state prison and ordered to pay more than $200,000 in restitution on May 7, prosecutors said.
Prosecutors said Bock stole the funds between June 2005 and September 2008. Bock, who prepared the church's deposits, took over 440 congregants' donation checks and deposited them into her personal account, prosecutors said.
Church officials discovered the theft in September 2008 and alerted police, they said.

Tuesday, March 23, 2010

Former Cornell University Finance Administrator Indicted for Embezzlement

A former Cornell employee received two years of probation last Thursday for embezzling $20,000 from Chicago’s tourism agency where she worked from 1997 to 2006, according to local reports.

Ming Liu Bengtsson directed financial transactions for Cornell as manager for accounting from 2006 to 2009 before joining the University of Illinois Urbana-Champaign’s College of Law in 2009 as assistant dean for finance and human resources. But before she worked for the two universities, Bengtsson had forged the signature of the Chicago Tourism Fund’s executive director and written herself a $20,000 check in August 2004, when she had access to the fund’s checking account as the project administrator at the city of Chicago’s Department of Cultural Affairs, according to The Champaign-Urbana News-Gazette.
The inconsistent signature caught the eyes of the inspector general’s office four years later. Bengtsson was indicted last August on theft, official misconduct and forgery. These charges could land her in prison for up to seven years. Although Bengtsson first pled not guilty, she later agreed to a plea bargain and repaid the $20,000 embezzlement in court last Thursday.
Bengtsson’s employment at Illinois began on June 1, 2009 at an annual salary of $115,000, according to the university’s trustee minutes last July. She resigned from her position on Aug. 31, UI’s spokesperson told the News-Gazette last September.
Her husband, Ola Bengtsson, is a former faculty member of Cornell’s Johnson School of Management and is now assistant professor of finance at the College of Business at University of Illinois Urbana-Champaign, according to his personal website.
While she was at Cornell, Bengtsson also contributed at the Kuali Foundation, according to the open source administrative software’s database. Cornell contributes to the development of this non-profit organization, a former University administrator told The Sun in March 2008, and many names on its directory are affiliated with Cornell.

Monday, March 22, 2010

Sutter, California school employee arrested for embezzlement

A Sutter Union High School District employee was arrested Sunday on suspicion of embezzling from the district.  Christopher Lawrence Crabtree, 37, of the 2100 block of Pepper Street, Sutter, was arrested by the Sutter County Sheriff's Department at 3 p.m. at his home. He was booked into Sutter County Jail, where bail was set at $15,000. He was no longer being held Monday.
Crabtree used a school district charge account to buy new auto parts for his personal use, according to Sheriff's Department spokeswoman Brenda Baker. He worked in the custodial and transportation departments, according to a jail booking sheet.
Crabtree is scheduled to be arraigned at 9 a.m. April 12 in Sutter County Superior Court.
Custodian Crabtree lists the same Sutter address in the 2100 block of Pepper Street as Larry Crabtree, a former teacher at Sutter High School.
Larry Crabtree works as a consultant preparing the orchard at the high school for harvest and supervising students' agricultural projects. He is the father of Tim Crabtree, 44, a trustee for the Sutter Union High School District and the target of a recall that Larry Crabtree supports.
Backers of the recall, which goes before voters in June, contend that Tim Crabtree "has demonstrated that he has a personal vendetta against the school district" and certain personnel including his father.
Tim Crabtree has said that he faces the recall for asking questions about school district policies and because he is not a rubber stamp for the district administration.
Neither Tim nor Larry Crabtree could be reached Monday for comment.

Sunday, March 21, 2010

Waco, Texas Diocese Says Audit Led To Church Theft Investigation

Inside the walls of Waco's St. Jerome Catholic Church Patricia Poehls was supposed to be teaching children Christian morals, but the Diocese of Austin says Poehls was instead stealing money. More than $154,000. "There is a lot of hurt and there is a lot of pain when something like this happens because, especially when it's one from your own community," Diocese of Austin Communication Director Christian Gonzalez says.
Poehls worked for the church from February 2004 until June 2008. When the church did their annual audit in July, they discovered thousands of dollars were missing.
"This is one of the cases there the audit worked. Because looking at the audit, discrepancies were found and then that led to the investigation" Gonzalez adds.
Waco police conducted the investigation. They say Poehls stole the money from January 2007 until June 2008. She is facing a second degree felony theft charge, but because the theft happened to a non profit agency, that could be bumped up to a first degree felony with much stiffer punishment, a maximum of 99 years in prison.
The Diocese of Austin says they are continuing to pray for both the Poehls' family and the parishioners of St. Jerome.

Saturday, March 20, 2010

Tennessee Church sues ex-pastor over alleged theft

A preacher who was supposed to be feeding his flock fleeced them instead, a lawsuit alleges. Carpenter's Chapel Inc., a church on Dogwood Road in Solway, has filed suit in Knox County Chancery Court against former pastor Hobart Randalls "Randy" Tinch, alleging he robbed church coffers of $347,000 during his 19-year tenure there.
Attorney Steve Shope, who is representing the church, said information gleaned from an audit of the church's books will be turned over to authorities for a criminal probe. Tinch, who lives in Oak Ridge, could not be reached for comment.
Shope described Tinch as a "charismatic" figure who used church offerings to support a lavish lifestyle that included pricey cars and expensive trips. The church was unaware of Tinch's alleged thievery until he stepped down as pastor in January 2008, when a resulting audit by a certified public accountant uncovered the misappropriation, Shope said.
The church sought to avoid litigation, but Shope said Tinch did not respond to attempts to meet with him to resolve the case outside of the courtroom.
"(Tinch) as pastor of the church took advantage of the relationship and violated the confidence of (the congregation) and misrepresented, concealed and misled (the church) to obtain money to pay for property and obligations of (Tinch) from (church) funds," the lawsuit alleges.
The lawsuit, filed this week, contends the church not only lost the pilfered funds but also has incurred costs to uncover the alleged embezzlement.
"The ... intentional fraudulent conversion of (church) funds has caused (the church) to suffer damages in excess of $400,000," the lawsuit alleges. "This amount represents the loss of funds, loss of profits for non-use and expenses in calculating damages, including accounting fees, attorney fees and interest."
The church is seeking $500,000 in compensatory damages and another $500,000 in punitive damages and any "rents or profit" Tinch earned from unspecified property the lawsuit alleges he bought with stolen church loot.
The lawsuit also seeks the forfeiture of any assets "obtained by fraud by" Tinch.

Thursday, March 18, 2010

Embezzlement of School Booster Club Funds No Joking Matter

It's always a shock when it's discovered that a trusted friend and volunteer embezzled thousands of dollars of school funds. Unfortunately, embezzlement of school booster funds seems to be happening more frequently embarrassing many schools and their administrators. "When need meets opportunity, money goes missing," stated Sandra Englund, President and founder of Parent Booster USA. "Unfortunately, most school volunteers and school administrators don't know how booster clubs should be properly operated and managed."
To curb abuse, Parent Booster USA, a national support organization for school booster clubs, published a Booster Club Start-Up, Operations and Financial Practices Guide. PBUSA's financial practice guidelines provide practical, step-by-step instructions for how to set-up financial controls for school booster clubs.
"I remember counting hundreds of dollars in cash brought in from a t-shirt sale on my bed. Just me and the cash. It hit me then just how easy it is for money to go missing and how important it is for all organizations to implement good financial controls," stated Englund
By following proper guidelines, not only are schools and their booster clubs protected, but volunteers also protect themselves from being accused of taking cash.
"Two years ago PTO president contacted me after being accused of embezzling money," said Englund. "She was originally accused of stealing $62,000. That amount has been reduced to $15,000and although formal charges have never filed, she's had to go to hearings every 1-2 months to try to clear her name. All because her PTO did not have or use good financial reporting guidelines."
In response to the increasing reports of theft or mishandling of booster club funds, more schools, school districts and even state governments are starting to take action. In 2007, Tennessee passed the School Support Organization Financial Accountability Act as one way for schools and school districts to provide more oversight of school booster clubs. Under the Tennessee law, school booster clubs must follow specific rules to be able to use the school's name, logo and facilities to raise funds for the school. Fundraisers also must be approved. Most schools and school districts, especially those outside Tennessee, remain unaware of the basic rules and requirements for operating a school support organization legally.
Federal laws require that school booster clubs file tax returns if they raise $5000 or more per year, and to establish an audit committee to conduct an annual financial review. The problem is that most parents who sign up to volunteer, and most school administrators, are unfamiliar with the rules and have no idea how to abide by them.
More information about Parent Booster USA, including how to obtain a copy of its financial guidelines for school booster clubs, is available at

Wednesday, March 17, 2010

3-year term for Fresno school embezzlement

A former business manager who has admitted to stealing $422,000 from a tiny southwest Fresno school district was sentenced Tuesday in Fresno County Superior Court to three years in prison.
Leonard Robinson, 52, wrote in a letter to Judge Jonathan Conklin that he was sorry for his actions.
Attorney Glenn LoStracco, who represented Robinson, had sought probation, arguing that Robinson stole from Orange Center Elementary School District to feed a gambling habit, not to live a lavish lifestyle.
But Conklin stuck to a three-year prison sentence that he had indicated in September when Robinson pleaded guilty to grand theft and second-degree burglary.
Robinson had faced a maximum term of five years and eight months in prison.
Prosecutors say Robinson, who was the business manager for 21 years, embezzled the money from October 2005 to January of this year. The burglary charge stems from stealing a district computer's hard drive in an attempt to cover up the theft, prosecutors say.
The Orange Center school district on Cherry Avenue has one school that serves about 310 students in kindergarten through eighth grade

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Tuesday, March 16, 2010

Darren Butler also pleads no contest to embezzling from Mt. Zion church in West Virginia

A 31-year-old Martinsburg man accused of setting fire to his own rental home while his family slept inside in an attempt to collect on an insurance policy accepted a plea agreement Monday. Darren Butler, formerly of South Raleigh Street, pleaded guilty to one count of first-degree arson and five counts of felony child neglect creating a substantial risk of bodily injury. He also pleaded no contest to one count of embezzlement in connection to an unrelated case in which he was accused of stealing $4,059 from Mt. Zion United Methodist Church in Martinsburg while serving as church treasurer in 2008.
The July 1, 2008, fire happened at Butler's rental home at 703 S. Raleigh St. in Martinsburg.
Butler's three children, stepchild, niece and former wife were sleeping inside the home at the time of the fire.
The case was investigated by the Martinsburg City Police Department and the Martinsburg Fire Department. Chief Fire Investigator Greg Hoover determined that the fire, which was actually the sum of two blazes, was intentionally set.
One fire was set using combustible materials in the basement and a second fire was set using combustible materials on a living room couch.
Investigators were able to determine that Butler and his now former wife had acquired a massive debt, and Butler had taken out a renter's insurance policy through Liberty Mutual just days before the fire.
"My wife and I were $60,000 in debt. I started the fire to get us out of debt and make a better life for ourselves," Butler told Circuit Court Judge Christopher Wilkes before entering his plea. "I knew that children were in the home at the time of the fire."
As a result of the fire and ensuing criminal investigation, Butler was indicted in February 2009 on one count of first-degree arson, fives counts of felony child neglect creating a substantial risk of bodily injury and setting a fire with intent to defraud insurance. Last May, he also was indicted on one count of embezzlement in connection to the case involving the church.
In accordance with the plea agreement, the charge of setting a fire with intent to defraud insurance was dismissed.
As a result of Butler's decision to plead guilty to the arson charge, the state, represented by Berkeley County Prosecuting Attorney Pamela Games-Neely, has agreed not to argue for more than a 15-year sentence for the arson conviction at sentencing.
Christopher Prezioso, Butler's attorney, also said that both parties have reached a binding agreement that the one-to-10-year prison sentence for embezzlement as a result of Butler's no-contest plea will run concurrent to whatever sentence he receives for the arson conviction.
Butler faces a one-to-five-year prison sentence on each of the five counts of felony child neglect. Under the terms of the plea agreement, those five sentences will be served consecutively, meaning Butler will be sentenced to a combined sentence of five to 25 years in prison for the criminal convictions. However, both sides have agreed that they will be free to argue at sentencing whether or not those combined sentences should be served consecutive to the sentence Butler will receive on the first-degree arson and embezzlement convictions.
Butler also will be ordered to pay restitution in connection to both the arson and embezzlement, court costs and associated fines. As a result of his guilty plea on the child neglect charges, the court also might make a finding that he is an abusive parent. That would require Butler to be registered with the state's central child abuse registry and could trigger abuse and neglect proceedings that may see Butler losing all parental rights to his children.
"The worst-case scenario would be the termination of parental rights," Wilkes told Butler. "... (But) I don't know what might happen."
Butler had been scheduled to go to trial today.
His former wife, who was present in the courtroom Monday, told Wilkes that she already had been granted decision-making power for the children and Butler had not been granted visitation rights.
After Butler entered his pleas, the matter was then sent out for a pre-sentence investigation. Butler's sentencing is scheduled for 1 p.m. June 22 before Wilkes.
Butler remains in custody at the Eastern Regional Jail while awaiting sentencing.

Monday, March 15, 2010

School bookkeeper in North Carolina charged with embezzlement

A bookkeeper at a Wayne County elementary school was arrested Thursday and charged with stealing from the school, police said Friday.

Bridgette Brown James was charged with embezzlement. Police said she stole more than $1,000 from Carver Heights Elementary School.

Sunday, March 14, 2010

Five Church Leaders from Uniondale, New York Plead Guilty to Securities Fraud Conspiracy

Late Friday afternoon, at the federal courthouse in Brooklyn, Isaac Ovid, the former Chief Executive Officer and Executive Chairman of Jadis Capital, Inc., an investment management company previously headquartered in Uniondale, New York, pled guilty to conspiring with other senior executives of Jadis Capital to commit securities fraud in connection with two hedge funds the firm managed. The plea proceedings were held before United States District Judge John Gleeson. Ovid’s guilty plea was the latest in a series by Jadis Capital executives before Judge Gleeson, including those of Aaron Riddle (former Chief Financial Officer), Joseph Jonathan Coleman (former Chief Marketing Officer and CEO), Timothy Smith (former First Vice-President and Chief Business Strategist), and Robert Riddle (former Northeast Regional Vice-President of Sales). By their guilty pleas, the defendants, all of whom held leadership positions in a Forest Hills church, admitted to their roles in a securities fraud scheme that involved two hedge funds, the Logos Multi-Strategy I, LP, and the Donum Fund, LP, which Jadis Capital created in February 2005 and August 2005, respectively. The defendants admitted that they conspired to market the hedge funds to prospective investors, including numerous members of their own church, employing material misrepresentations and omissions contained in private placement memoranda and other marketing materials concerning the management, supervision, and historical and expected trading performance of the funds. In total, the defendants collected approximately $9.3 million in investments in the Logos Fund and approximately $3 million in investments in the Donum Fund.
Rather than using the investors’ capital to support the two funds, the defendants used the vast majority of investor money to purchase lavish gifts for their friends and themselves, including a $200,000 Bentley automobile used by Ovid and others; to pay the inflated operating and payroll expenses of Jadis Capital, including an approximate $1.6 million renovation of the Uniondale offices; and to satisfy debts that Ovid incurred before starting Jadis Capital. In September 2005, the defendants, without disclosing the misappropriation of investor funds and extremely poor trading performance of the Logos Fund, fraudulently solicited and accepted a $3,000,000 investment from another victim for the Donum Fund. In total, the defendants collected approximately $12.3 million in investments for the two funds and either lost or spent $10.2 million of investors’ money.
Mr. Campbell expressed his grateful appreciation to the Federal Bureau of Investigation, the agency responsible for leading the criminal investigation, and thanked the United States Securities & Exchange for its assistance.
The government’s criminal case was prosecuted by Assistant United States Attorneys James G. McGovern and Michael L. Yaeger.

Saturday, March 13, 2010

Jasper County, Mississippi Woman embezzled over $100K from church

The Jasper County Sheriff’s Department has arrested a local woman for embezzlement in connection with her activities at a church in Jasper County. Jasper County Sheriff Kenneth Cross said Phyllis Daughdrill was arrested Thursday for embezzling over $100,000 from a church.
According to Cross, Daughdrill lives in the southern part of Jasper County but has a Laurel mailing address.
The sheriff said Daughdrill, who was the secretary at Corinth Baptist Church of Heidelberg for approximately 10 years, was arrested after the Sheriff’s Department received reports concerning some missing money.
Officials said Daughdrill’s arrest is the result of information received along with an investigation conducted by the Sheriff’s Department.
“This case started back around Feb. 21st. So, we’ve worked on this a little over a week and a half,” the sheriff said. “It looks like this has been taking place over a long period of time.”
Cross said Daughdrill was taken into custody by the Jasper County Sheriff’s Department and charged with one count of embezzlement.
Cross said Friday afternoon that Daughdrill is the only person who had been charged in connection with the incident.
Officials said the total amount of cash missing from the church has not been determined.
“We are still investigating it all,” the sheriff said. “We know it’s more than $100,000, but we are still investigating at this time.”
Daughdrill was booked into the Jasper County Adult Detention Center.
She had their initial court appearance on Thursday in Jasper County Justice Court for District One in Paulding.
During the court hearing, Justice Court Judge Sullivan Duke set her bond for $10,000. She was later released from jail on bond.
Felony embezzlement carries a maximum sentence of 10 years in prison and/or a $25,000 fine.
Law enforcement officials said embezzlement can be the theft of money or merchandise.

Friday, March 12, 2010

Lawrence, Massachusetts school superintendent indicted on embezzlement charges

School Superintendent Wilfredo Laboy was indicted today on nine charges following a lengthy probe into alleged financial wrongdoing in his troubled school district. Laboy has been on leave since June, when police raided his office and confiscated computer equipment from his home. He is expected to be arraigned in Salem Superior Court Thursday. He faces eight counts of fraud or embezzlement and one count of possessing alcohol on school grounds, prosecutors said.
"The crimes alleged involve a serious violation of the public trust," Essex District Attorney Jonathan W. Blodgett said in a statement.
Prosecutors said Laboy, on various dates between March 9, 2004 and today, had school personnel do work at his home and run errands for his benefit. The employees allegedly did electrical work at Laboy's home and met with contractors at the home during school hours.
The employees also allegedly provided graphic design work, materials, and produced copies of menus for a Methuen pizzeria; provided graphic design work and produced materials for the Association of Latino Administrators and Superintendents; provided technical support for Laboy's home computers; removed trash from his house and disposed it on Lawrence schools property; and provided transportation for Laboy's son and grandchildren.
Scott Gleason, Laboy's attorney, didn't immediately return a telephone message seeking comment. No one answered the door when a Globe reporter went to Laboy's home today.
Prosecutors also charged Laboy's former special assistant, Mark Rivera, with seven counts of larceny over $250 for allegedly misappropriating materials from the graphic design department of the schools. Prosecutors alleged that Rivera directed school graphic designers to design and produce campaign literature for six candidates and to design and produce materials for the Association of Latino Administrators and Superintendents.
Former mayoral candidate Israel Reyes was also charged with two counts of larceny. He allegedly directed school employees to design and print campaign literature for himself and for Massachusetts Representative Barry Finegold.
Prosecutors said not all the candidates knew that printing was being done for them by the school employees.
Laboy's son, Wilfredo Laboy II, was also indicted on a perjury charge.
In September, the state Office of Campaign and Political Finance found that Laboy and others illegally used the school department press to print campaign materials for candidates who were seen as Laboy's allies.
The School Committee has been reluctant to fire Laboy during the probe, fearing they were on shaky legal footing. Laboy has been receiving about $4,000 a week in accrued vacation and sick days.
Since becoming superintendent in 2000, Laboy has been a frequent lightning rod for controversy. A native of Puerto Rico who moved to New York City as a young boy, he failed a required English proficiency test three times. He billed the district for running boards on his SUV, saying his wife was having a hard time getting in and out of the vehicle in heels. He was involved in a scuffle with a female School Committee member in his office.

Thursday, March 11, 2010

Bonita Springs, Florida Church files embezzlement complaint

A representative of a Bonita Springs church filed a complaint with deputies claiming a person involved with the church has embezzled $60,000. The man, whose name has not been released by investigators, allegedly used funds from the church's bank account for rent and dining out.
The Life Point Church rep also says other incidents have occurred involving the church's tax ID number and bounced checks from their account.
Deputies are investigating the allegations.

Wednesday, March 10, 2010

Ex-church secretary pleads guilty in Cumberland County, Pennsylvania embezzlement case

The former secretary of the Mount Holly Springs United Methodist Church pleaded guilty today in Cumberland County Court to embezzling thousands of dollars from the church's emergency fund for the needy. Jane Poth, 50, of Newville, pleaded guilty to one count of theft by unlawful taking, Senior Assistant District Attorney Daniel Sodus said. She has no plea agreement and investigators are still determining how much was taken, he said. Poth is to be sentenced by Judge Edward E. Guido in May.
When Poth was arrested in July, state police said she had stolen about $35,000 from the church between 2001 and the fall of 2008.

Monday, March 8, 2010

Guilty plea entered in theft from St. Vincent dePaul Society in Buffalo, New York

Raymond Smyth, a former top official of the Society of St. Vincent dePaul, a charity affiliate of the Buffalo Diocese, pleaded guilty this afternoon to stealing $324,388 of its funds before he resigned from the organization last September. Erie County Judge Sheila A. DiTullio did not give Smyth, 44, a sentencing commitment but allowed him to remain free without bail with the agreement of prosecutors pending his June 14 sentencing.
Smyth, who was chief financial officer of the Main Street charity for 19 years prior to his resignation, pleaded guilty to a single count of second-degree grand larceny and signed a confession of judgment for the full amount of his embezzlement.
Erie County District Attorney Frank A. Sedita III and John C. Doscher, chief of the DA's Special Investigations Bureau, said Smyth admitted illegally using society credit cards from July 1, 2002 through last Aug. 31.
The prosecutors said Smyth, of Delaware Avenue, pleaded guilty before indictment to the highest charge a grand jury could have lodged against him for the thefts. Smyth, who faces a possible prison term of up to 15 years, declined comment following his plea proceeding.

Sunday, March 7, 2010

Man charged with stealing weekly church offering in Elizabeth, Tennessee

A man charged with stealing the weekly offering at Lynn Valley Baptist Church has waived his right to a preliminary hearing and was bound over to a Carter County grand jury Friday. Cody Bowling, 23, 267 Blevins Hollow Road, was also bound over on several other burglaries, some of them in his Blevins Hollow neighborhood and one going back to 2007.
Bowling is accused of taking $3,419 in cash and checks from the Jan. 10 offering of the Lynn Valley congregation. The burglary was discovered Jan. 11. Two laptop computers were also stolen. Five doors and a safe were also damaged in the burglary.
Bowling was arrested Jan. 12 when Sgt. Brian Durham and Deputy Dean Jones of the Carter County Sheriff’s Department responded to another church burglary in progress, this one at Dungan Chapel Baptist Church. When the deputies responded, they found a blue Suzuki car in the church parking lot.
The officers entered the church through an open door and found several rooms had been ransacked. Jones found a door that was locked from the other side and that had no keyhole. He ordered anyone in the locked room to come out. They said Bowling then opened the door and came out.
A pair of bolt cutters and a pry bar were found in the room, police said. Bowling was arrested and his car was inventoried. During the inventory, the officers found a pill and some drug paraphernalia, including a syringe. A Verizon/Visa $50 rebate card assigned to Kelly Salinas was found in the console. Salinas, a resident of Blevins Hollow, reported the burglary of her residence Dec. 7. She said a file was taken that included the rebate card. She said a Peavey amplifier had also been stolen. The officers said they found the amplifier in the trunk of Bowling’s car.
Also found in the car was a Kodak camera, which was identified as being stolen in one of three New Year’s Eve burglaries committed two weeks earlier at an apartment building at 1294 Bluefield Ave.
On Jan. 14, Capt. Rocky Croy and Investigator Jan Black of the Carter County Sheriff’s Department interviewed Bowling. They reported he confessed to the Lynn Valley Baptist burglary and gave consent to search his residence.
The investigators reported the search uncovered evidence from several other burglaries, including several in the Blevins Hollow area, the Bluefield Avenue burglaries and one burglary that goes back to March 27, 2007.
The evidence from the 2007 burglary was a black Sentry safe that had been reported stolen from the residence of Ruth Lewis on Dan Berry Hill Road. The safe still had Lewis’ name on it and a box inside that had her phone number. An investigator called the number and when Lewis answered, he identified himself and asked her if she had been the victim of any burglaries. She told him she had a small safe, cash and checks and two rings stolen.
Investigators also found a BB&T bank bag full of receipts that belonged to Rizk Baltaji and contained the name Rico’s Pizza, which is near Blevins Hollow and was hit by a burglar Nov. 8.
Evidence from another Nov. 8 burglary was also found at Bowling’s home. A bottle of prescription medicine had the name of a victim at 295 Blevins Hollow Road. Also found were three boxes of insulin syringes and a gas can with a unique tap. The gas can had been taken from 295 Blevins Hollow Road during an earlier burglary Sept. 28.
Items not recovered from the burglaries included several guns, a 32-inch flat screen Panasonic television and $6,700 in cash.
Elizabethton investigators said they learned that a PlayStation 3 game console taken from one of the Bluefield Avenue burglaries had been sold by Bowling at New Trade, 1342 Milligan Highway.

Saturday, March 6, 2010

Fairfax county, Virginia High School employee quits after embezzlement charge

A Fairfax County Public Schools employee has resigned after being charged with embezzlement. Susan Thanh Litwin, 37, of Woodbridge, was arrested Friday on allegations that she stole approximately $280,000 from Thomas Jefferson High School for Science and Technology.
According to an affidavit filed in federal court, Litwin had served as a "finance technician" for the school since January 2007 and was responsible for receiving and depositing funds from various sources intended to support student athletics, classes, clubs and other school activities.
"She took care of money coming in from booster clubs and those sorts of programs," said FCPS spokesman Paul Regnier.
According to court documents, Litwin allegedly deposited some of these funds into her personal bank accounts. From about March 2008 through January 2010, court records allege that she stole more than $279,000 through checks or withdrawals ranging from $2,500 to $35,000.
Court records indicate that in an interview with federal agents on Tuesday, Litwin allegedly told law enforcement that the money was used to support a gambling habit that included trips to Las Vegas, Nev., and Atlantic City, N.J.
She also allegedly stated that the theft was a result of extensive credit card debt and large mortgage payments on her home. According to Regnier, Litwin tendered her resignation to FCPS that same day. She turned herself in to the FBI on Friday, according to the U.S. Attorney's office.
"These are difficult financial times for many public institutions, and an employee who breaks that trust needs to be held accountable," U.S. Attorney Neil MacBride said in a release. "We're grateful for the help Fairfax County Police Department and the Fairfax County Public Schools provided to this investigation, along with the FBI agents who helped put together the evidence in this case."
Litwin went before federal magistrate John F. Anderson for a preliminary hearing Friday afternoon. Among other conditions, Anderson allowed her to be released on an unsecured bond pending her trial on March 18 on the condition that she refrain from gambling -- including purchasing state-sponsored lottery tickets -- and attend Gambling Anonymous.
Litwin's attorney, Michael Cantrell, was unavailable for comment late Friday afternoon, according to an employee in his law office.

Fraud charges withdrawn in Delco, Pennsylvania school case

The Delaware County District Attorney's Office yesterday withdrew charges against a former member of the Penn-Delco school board who had been accused of embezzling funds from a private high school sports booster club. John Green of Brookhaven was president and treasurer of the Sportsters Club, in Aston,
when he was arrested in May for theft and receiving stolen property.
Green gave investigators a financial accounting that showed he had paid bills from his own account to cover club expenses. He then reimbursed himself when club funds became available, his attorney said.
Green's legal woes might not be over, however. The District Attorney's Office said in a news release that the investigation isn't done yet.
In 2007, Green, a Penn-Delco school board member at the time, pleaded no contest to conflict-of-interest charges, after he failed to disclose that he worked for a company that had a school-district contract and that he would receive a commission.
Last March, Green was fined $500 by the state Ethics Commission when it found he had failed to file his financial-disclosure form.
In June 2008, Robert Mesaros, superintendent of the Penn-Delco District, called police to report possible missing funds from the club, according to court records. The club members were students at Sun Valley High School.
"They never looked at his bank account," Michael F.X. Gillin, Green's attorney, said yesterday. "They only looked at the club's bank account."
Gillin said that Green had advanced the club about $8,800 of his own funds, then reimbursed himself when members paid dues. Green paid for event locations, trophies, and flowers from his personal account because the club was often short of cash.
Gillin provided The Inquirer with a document stating that Green had paid out more than $19,000 on behalf of the club and was reimbursed about $16,000.
Green, who had two daughters in the club, told investigators what he had done, Gillin said. "He admits he was a lousy bookkeeper," the lawyer said. "But he is no thief."
Michael Dugan, assistant district attorney, declined to comment on the withdrawn charges.
The D.A's Office said in the release that the investigation was continuing, thanks to newly received information. Erica Parham, spokeswoman for the office, declined to elaborate.

Friday, March 5, 2010

Skiatook, Oklahoma school patrons want grand-jury probe

Angered by a state audit that revealed a pattern of wasteful spending in the Skiatook school district, a group of residents on Wednesday night released a grand jury petition that it hopes to have filed by March 29.

Organizer Rob Ridenour, a Skia- took parent and criminal defense lawyer, implored a crowd of about 83 people at the town's community center to channel their disgust into something positive.
"Our taxpayers and our kids have been done wrong," said Ridenour, who was accompanied by fellow Skiatook residents and organizers Windsor Ridenour, his father and a former executive editor for the now-defunct Tulsa Tribune, and Kathryn Cooper, a Skiatook parent and executive assistant to the Tulsa World publisher.
"We're not going to be able to get that money back — not most of it," Rob Ridenour said. "But we need to make sure that this doesn't happen again. And we have to do that by sending a clear message."
Last week, a state auditor's report said the district paid Oklahoma City middleman Rick Enos, through his companies E&E Sales and Austin Security, $570,000 more than it would have paid for custodial supplies and security equipment directly.
Purchasing such things as trash cans, sanitizer and mop heads, the school often paid double, triple or quadruple the open market price for the items ordered through E&E Sales, according to the audit, which spanned May 1, 2004, to Jan. 31, 2009.
The district paid an Enos company as much as $29.95 — a markup of 892 percent — for a dust-mop handle that could have been bought for $3.02. Trash cans that could have been bought directly for roughly $10.88 were purchased by the school for $60.
The school board on Tuesday suspended with pay Superintendent Gary Johnson, who has been employed by the district since 2001.
The state Attorney General's Office is reviewing the audit report.
The Skiatook group's petition asks the Tulsa County District Court to impanel a grand jury to investigate "any fraud, theft, misapplication of funds, public corruption, kickbacks, graft or embezzlement of public funds."
Referring to the special audit report, it also asks the grand jury to probe a pattern of "systematic overcharging, collusion and document falsification in the expenditure of public funds for the procurement, processing and administration of supplies, equipment and systems" for the district from 2004 to 2009.
Rob Ridenour said he has a sister who works for the school district who was asked to turn off her space heater to save electricity.
"My daughter gets into the car the other day and says, 'Daddy, they said that we can't have any math books because we don't have any money,' " he said.
"When somebody wastes three-quarters of a million dollars, you think to yourself, what could that three-quarters of a million dollars been used for?
"How many computers would that buy? How many books would that buy? That just makes a person so mad. I know you're mad. I want you to stay mad, and let's follow through with this."
Under state law, a petition for a grand jury must state the subject matter for a prospective grand jury's consideration and reasonably specific areas to be investigated.
It also must state sufficient general allegations to warrant a finding that such an inquiry might lead to an indictment or removal of a public official.
If a judge approves the petition request, circulators would have 45 days to gather the required number of signatures — 5,000, according to Rob Ridenour — of registered Tulsa County voters in support of the request.
If the Tulsa County Election Board verifies the signatures, the judge would turn over the case to the district attorney, and then a grand jury would be convened.
Noting the need for a grand jury, Rob Ridenour said prosecutors could take as long as six months to decide whether charges are warranted.
"This process makes these guys do what we want them to do," he said.
Skiatook resident Michael Jackson asked whether it was appropriate to circulate a petition in church.
"The churches are going to be full Easter Sunday," said Jackson, who said he pastors a Tulsa church. "You have all the people in one spot."

Wednesday, March 3, 2010

State police investigate possible embezzlement of church funds in Birch Run, Michigan

Personnel from the state police Bridgeport Post are investigating a possible case of embezzlement at the Christ Lutheran Church, 8101 Poellet, in the Village of Birch Run, said State Police Sgt. Kristin R. Winterstein Monday.

She said the investigation began in September, but she declined to share any further details of the investigation.
Rev. Dr. Richard D. Hillenbrand, who the Lutheran Church Missouri Synod Web site lists as a Frankenmuth resident and the church’s pastor, said he will not comment on the matter until the investigation is completed.
The congregation has 373 “confirmed members” and an estimated weekly-worship attendance of 130, the Web site says.

Tuesday, March 2, 2010

Dispute over restitution delays Two Harbors, Minnesota school district embezzlement sentencing

Sherry Udenberg was charged with embezzlement of an estimated $65,275 from the district from 2007 to 2009. A dispute over how much restitution should be paid has held up court proceedings for a woman accused of stealing $65,000 in food service money at Two Harbors High School.
Sherry Rae Udenberg was scheduled to appear for formal sentencing Monday in Lake County District Court after reaching a plea agreement last month with the county attorney’s office. Her attorney is disputing the amount of money his client is said to have stolen from the school district. Court documents state she embezzled more than $65,000 in a three-year span that ended with her sudden resignation last fall as a financial assistant and food service coordinator in the district. She had been a 13-year employee.
Attorney Arthur Albertson said his client doesn’t deny wrongdoing but she thinks the district’s figure on how much money she took is incorrect. He said he needed more information from the school district about how much money was owed. He questioned how the district came up with the $65,000 figure.
Udenberg faced three felony counts related to how she handled money coming into the high school office for student lunch accounts. She admitted to police that she created a fake accounting program to cover up money she was supposed to deposit in the district’s bank account. Student accounts were credited and the money the district lost is covered by insurance.
Albertson said the amount the district wants for restitution might include accounting mistakes made by other staff in calculating how much students paid for lunches.
Superintendent Phil Minkkinen disagrees. He said the restitution numbers are based on data from cash receipts to deposits made at the bank.
Udenberg told police she deposited checks and coins but pocketed cash when making deposits. She avoided detection from state audits by applying the program she created. Under district policy, Udenberg was supposed to count money brought in for student lunch accounts after it was counted by the high school office. She was supposed to return the money to that office for deposit but, instead, according to the complaint, she did the deposits herself.
Lunch money collected from district students in Silver Bay and Minnehaha Elementary in Two Harbors was directly deposited into the bank and didn’t go through Udenberg.
Udenberg pleaded guilty to one felony count of theft with counts of felony embezzlement of public money and felony forgery dismissed depending on a review of the plea agreement.
She was expected to avoid what could have been a 10-year sentence and spend six months at the Duluth Bethel female offenders program and/or 90 days in jail and 60 days of electronic monitoring. Details on her punishment and the restitution were expected Monday before the dispute came up. There is no date set for Uden-berg’s next appearance in court. She was not jailed upon her arrest.
A stay agreement means an offender must comply with conditions established by the court or be sentenced under the offense guidelines. In Udenberg’s case, felony theft is punishable with a 10-year prison sentence and/or a $20,000 fine. If Udenberg complies, the recommended sentence is dropped and the offender has a record of a misdemeanor rather than a felony.
A probation officer looks over the plea and investigates a defendant’s past and either abides with the plea agreement or offers another arrangement. Udenberg could back out of her guilty plea if the officer disagrees with any new conditions.
She probably will serve time at Duluth Bethel — the only other option would be jail. According to Bethel’s Web site, it provides “individuals dignity, hope and the opportunity to improve their quality of life through chemical dependency rehabilitation and community correction services.”

Monday, March 1, 2010

Riverdale, Illinois school board president keeps post despite indictment

The president of the Riverdale, Ill., school board continues in that role despite a federal indictment that accuses him of multiple counts of fraud involving out-of-state school districts, two universities and his former employer, a local substance-abuse agency.

Tom Schroeder, of Port Byron, Ill., was "replaced" late last year as the director of the Rock Island County Council on Addictions, or RICCA, leaders from that agency said. Federal investigators in Kentucky identified former college dean Robert Felner as Schroeder's "co-conspirator" in a plot to embezzle $2.3 million by misdirecting grant and other money into bank accounts that could be accessed only by the two men.
Felner, the former dean at the University of Louisville and a longtime associate of Schroeder, pleaded guilty last month to nine counts of mail fraud, conspiracy to commit money laundering and conspiracy to impede and impair the IRS. His plea proceedings disclosed for the first time that RICCA was a
victim of the scam.
Schroeder pleaded not guilty to the charges outlined in an updated indictment filed earlier this month. He is scheduled to go to trial on Aug. 9 in Louisville, Ky. He could not be reached for comment, but his Louisville-based attorney confirmed the updated not-guilty plea.
Federal prosecutors say Schroeder and Felner created the National Center for Public Education and Prevention, or NCPEp, to divert money headed for the University of Louisville and the University of Rhode Island.
A university-based analysis center with a similar name performed contract work for public schools in Atlanta, Buffalo, N.Y., and Santa Monica, Calif., prosecutors allege. The money paid to the center was redirected to NCPEp and, ultimately, three bank accounts controlled by Schroeder and Felner.
One of the accounts was opened by Schroeder at a bank in Rock Island.
About $2.3 million was redirected to NCPEp, the indictments claim. Schroeder was listed as president of the company and was paid $3,000 a month as a "consultant." Prosecutors further claim that NCPEp was a bogus firm that did none of the school-district consultancy work it billed for.
The center continued to receive funding even after it was dissolved by the State of Illinois in 2006 for failing to file annual reports.
As part of Felner's plea deal, which includes a punishment of up to 63 months in prison, he admitted to embezzling $88,750 from RICCA, which is based in Moline.
Allegations against the two men first were disclosed in a 2008 federal indictment, which did not name RICCA as a victim. Schroeder remained at the head of RICCA until two months ago. As Felner headed toward a plea deal, members of the RICCA board became increasingly suspicious, said William Burrus, president of the RICCA board and principal at Moline High School.
"We like to believe people who are professing their innocence," he said Thursday. "You can only take that so far. We were just really disappointed, to say the least. Disappointed is a gross understatement."
Federal investigators at first assured board members that RICCA money was not involved in the case, Burrus said.
"Then - bam!" he said of Felner's plea. "We saw $89,000 had been swindled."
That is when things started to heat up at RICCA, Burrus said.
"The real scrutiny started in October," he said. "We are going through every reimbursement check, every travel expense. We're gathering everything we think is suspicious to cooperate with the federal prosecutor and the IRS."
For many months, Burrus said, any suspicions by the RICCA board were explained away by Schroeder. One repeated explanation for the condition of finances at the agency was "the perfect storm of distraction" with the delays RICCA experienced getting money it had coming from the state.
"The economic troubles for Illinois were used," he said. "At the time, the explanation was very satisfactory."
But the story began to fall apart, he said, following Felner's plea deal, a new indictment against Schroeder and the internal audits that were under way at RICCA - with the help of federal investigators.
"I think (the internal audit) really expanded their investigation," Burrus said of the new interest federal investigators have shown in RICCA. Burrus said he could not elaborate on what has been discovered, saying it could be used as evidence.
In addition to being sentenced to prison if convicted, Schroeder's $400,000 home on Eagle Point Court in Port Byron, Ill., could be seized by federal authorities.
Despite all his troubles, including allegations he defrauded school districts in at least three states, Schroeder continues to serve as president of the Riverdale School District. It serves Port Byron, Hillsdale, Cordova and Rapids City, Ill., and has 1,178 students.
Two of the three school board members who could be reached for comment on this story said they had nothing to say.
"It's not a school board matter," board member Todd Caves said of the charges against Schroeder. "I'm the junior member of the board, and you're not going to get a comment out of me."
Board member Sherry Creen had a similar response.
"I don't know anything about it," she said. "I haven't read one story. I don't want to be involved in that, so I'll have no comment."
Rick Kessler, also a board member, said Superintendent Ronald Jacobs assured the board that Schroeder had no financial dealings with the Riverdale School District or any other Quad-City school district, which was enough for them.
Jacobs was on vacation last week and was not available for comment.
Kessler knew of the indictment and heard Schroeder no longer worked for RICCA, but those issues are "irrelevant" to the school board, he said.
"When our members say they don't know what's going on, quite honestly, that's not a smoke screen," Kessler said. "We don't know."
And, he added, he doesn't want to know.
"This is a personal matter for him," he said of Schroeder. "I'm sure Tom will do the right thing."
Herb Schultz Jr., a Rock Island attorney, resigned his volunteer appointment on the RICCA board to represent Schroeder but is no longer involved in the case. Another former Quad-Citian, David Mejia, is practicing law in Louisville and is representing Schroeder.
Felner is not expected to testify at Schroeder's trial, Mejia said. Testifying was not a provision of Felner's plea.