The Knowlton Township school board's former business administrator pleaded guilty today to embezzling about $70,000 from the Warren County school district.
Kevin M. Mulligan, 34, of Hasbrouck Heights, N.J., pleaded guilty to a charge of second-degree official misconduct before Superior Court Judge Robert B. Reed in Warren County.
Under the plea agreement, New Jersey prosecutors will recommend that he be sentenced to three years in state prison.
Mulligan must pay full restitution to the school district, forfeit his entire state pension and be permanently barred from public employment.
Acting Attorney General John J. Hoffman announced the details this afternoon.
Mulligan admitted that between July and December 2013, he stole about $70,000 by writing fraudulent checks against the district's bank accounts that were made payable to himself or, in one instance, to someone he owed money.
Mulligan began working for the district in June 2013 and resigned abruptly last December.
"Mulligan corruptly used his position to embezzle $70,000 that should have been used for the vital mission of educating students in this kindergarten through sixth-grade school district," Hoffman said in a statement. "It's always a serious crime when a public official steals taxpayer funds, but it's particularly egregious when those who suffer the consequences are young children."
Deputy Attorney General Mallory Shanahan prosecuted the case. The charges were the result of an investigation by the New Jersey State Police Official Corruption Bureau and the Division of Criminal Justice.
Sentencing before Reed is set for Oct. 24.
Elie Honig, director of the Division of Criminal Justice, said a prison term will send a stern message.
"By sending this school administrator to prison, we will deter other officials who might consider stealing public monies to address their personal financial problems," Honig said. "We urge anyone with information about the misuse of school funds or resources to contact us confidentially so we can investigate and prosecute those responsible."
As business administrator, Mulligan was a signatory on the district's three checking accounts and was responsible for paying all of the district's bills and its payroll. The state's investigation revealed that Mulligan created four fraudulent checks totaling $66,550 that he made payable to himself, but that he entered into the district's computer system as checks to various approved vendors or recipients.
The general account required that checks be signed by the school board president and its treasurer, as well as Mulligan, but Mulligan had signature stamps for them, prosecutors said.
For each false check from the general account, Mulligan went into the check printing software and changed the name and address of the pre-approved vendor or recipient in the "remit to" section to his own name and address. After printing the check, he re-entered the system to change that section back to the approved party.
Mulligan also wrote a school district check for $1,000 payable to a hockey instructor he hired for a youth hockey camp he operated, prosecutors said. In addition, he overpaid himself $600 on his first paycheck, and overpaid himself $1,869 on a check he received as reimbursement for waiving certain pension benefits.
The thefts were discovered after Mulligan resigned. School district officials received a canceled check for $10,362 dated December 13, 2013, which was made payable to Mulligan, but was entered into district records as a payment to the district's heating oil supplier. District staff checked with the vendor, which had not received the payment.
The district conducted an audit and discovered additional fraudulent checks made payable to Mulligan, prosecutors said.