Recent municipal fraud incidents per http://fraudtalk.blogspot.com:
Former Illinois Investment Advisor Sentenced In Michigan Union Pension
Fraud Scam
John A. Orecchio, 44, formerly of Arlington Heights, Illinois, was sentenced today to 9 years and 4 months in
federal prison for embezzling more than $24 million from several union pension funds in Michigan. Orecchio
was also ordered to pay some $26.4 million in restitution, plus a $50 million civil judgment in favor of the
U.S. Department of Labor. Prosecutors alleged that over a four year period, Orecchio, as a partner and cofounder of AA Capital Partners, defrauded six separate union pension funds, including those of the Michigan
Regional Council of Carpenters and the Operating Engineers, Local 324 spending investment funds to
support a lavish lifestyle that included luxury vehicles, thoroughbred racehorses, private jet junkets to Las
Vegas and tropical islands, luxury sports events, real estate and an investment in a strip club. According to
reports, approximately $100 million of the nearly $200 million in pension funds invested with Orecchio has
been recovered, thus far.
Michigan Municipal Treasurer Pleads No Contest To Embezzling More Than
$300K
Margaret Frances Jorasz, 51, of Wilson, Michigan, pleaded no contest yesterday to charges she embezzled
more than $308,000 from Harris Township, Michigan, where she had served as town treasurer. Authorities
believe Jorasz' thefts lasted about 7 years, beginning in 2002 and continuing until August 2009, when she
resigned after the scheme was discovered. Jorasz simply wrote herself checks from township property tax
account, according to reports. Jorasz, who was arrested on March 17, 2010, was sentenced to six months in
jail plus 18 months probation. She has reportedly paid in full the $308,049 she stole in restitution. We note
that Jorasz' husband, Alex Jorasz Jr., is a trustee on the township board.
Michigan Municipal Employee Sentenced For Embezzling $174K From
Township
Tommie McCarthy, 38, of Alpha, Michigan, was sentenced to one year and a day to fifteen years in prison for
embezzling $174,000 from the Village of Alpha, for whom he had been employed as town clerk. According to
authorities, McCarthy's scheme spanned nearly two years, from April 2007 until March 2009. According to his
attorney, McCarthy used the stolen funds to buy items such as groceries, movies, toys, and Wal Mart gift
cards for himself and children he coached on local sport teams.
Compiled by Brian Hudson
Former Indiana Housing Authority Exec & Political Activist Pleads Guilty To
Embezzling $214K
Jennifer Winningham Edwards, 59, now of Rockford, Michigan, pleaded guilty to charges she embezzled
nearly $214,000 from the Delaware County Housing Authority (DCHA) in Indiana where she had served as
executive director. Edwards is also reportedly a longtime Democrat Party operative and community activist.
As part of the plea agreement, Edwards must make full restitution in the amount of $213,936. Edwards
headed up the DCHA as well as the Middletown Gardens housing complex from 1997 until last year, when a
state audit revealed her alleged scheme. Authorities allege that between May 2004 and November 2008,
Edwards prepared bogus invoices that reflected work done for the DCHA by a legitimate firm, and then
deposited the resulting housing authority checks, totaling $176,790, into her personal bank account. She is
further alleged to have received invoices from the companies that renovated and furnished her Mount
Pleasant Township home, then altered those invoices to instead reflect the work had been done on DCHA
properties, receiving an additional $37,146.
Former Municipal Bookkeeper In New York Charged With Embezzling More
Than $350K
Pegeen Mulligan-Moore, 40, of Valatie, New York, has been charged with embezzling more than $350,000
from the towns of Kinderhook and Greenport, New York, where she had been employed as a bookkeeper.
Last September, Mulligan-Moore was charged with 18 felonies and two misdemeanors, which includes two
counts each of felony second- and third-degree grand larceny and one count of fourth-degree grand larceny;
two counts of computer trespass; two counts of first-degree tampering with public records; eight counts of
first-degree falsifying business records; and second-degree attempted forgery—all felonies—and misdemeanor
counts of obstructing governmental administration and criminal possession of stolen property. Prosecutors
allege that Mulligan-Moore's schemes spanned a three year period from December 2006 until the end of
December 2009. She is alleged to have embezzled more than $287,000 from Kinderhook and approximately
$53,000 from Greenport by depositing checks intended for the municipalities into her own accounts and
paying her credit card bills online with municipal funds.
Former Pennsylvania County Official Charged With Embezzling $347K
Vickie L. Glatfelter, 49, of Dover Township, Pennsylvania, has been charged with embezzling $347,477 from
York County, Pennsylvania where she had served as assistant chief clerk. According to authorities, over a
period of more than 7 years, from June 2003 to September 2010, Glatfelter committed 808 separate thefts of
refunds for postage meter overcharges that she engineered, depositing the funds into her own accounts.
Glatfelter had been employed by the county for some 27years.
Compiled by Brian Hudson
Tennessee Woman Pleads Guilty To Embezzling Nearly $100K From
Municipality
Arnita M. Mitchell,
44, of Mason, Tennessee, pleaded guilty to charges she embezzled $96,000 from the
town of Mason, Tennessee where she had served as City Court Clerk in charge of cash collections,
among other things. According to authorities, Mitchell pocketed cash receipts over a period of some
30 months. Mitchell, who was originally indicted in November 2009 on felony theft, forgery,
computer fraud, theft of services, and official misconduct, was sentenced to 90 days in jail and ordered
to pay full restitution. She will also be placed on probation for 8 years after her prison sentence.
Connecticut Woman Sentenced in $200K Payroll Embezzlement Scheme
Lisa E. Bloomer, 50, of Plainfield, Connecticut, was sentenced to 2 years in prison for bilking the state out of
some $207,000 in compensation, where she had been employed with the Connecticut Department of
Developmental Services. According to authorities, Bloomer forged payroll hours for time she was actually
gambling at casinos. Bloomer's scheme spanned a three year period between 2005 and 2007. Bloomer pleaded
no contest to the charge of first-degree larceny. Bloomer's gambling addiction was reportedly ignited by her
boss, Alisa M. Bobinski, 55, of Colchester, Connecticut, who brought her to the casinos to gamble regularly.
Bobinski has also been arrested and is awaiting trial.
Former Idaho County Chief Deputy Clerk Investigated For $139K Alleged
Embezzlement
Sandy Martinson, 65, of Coeur d'Alene, Idaho, is under investigation by authorities in Kootenai County for
allegedly embezzling $138,905 from county coffers, where she had served as Chief Deputy Clerk for some 35
years. According to authorities, a routine financial review after Martinson retired last month revealed the
irregularities. Details regarding the alleged misappropriation have not been released although it is believed
the funds have gong missing over the past ten years.
Former Indiana Bookkeeper and Current Municipal Treasurer, Accused of
Embezzling $2 Million
Gail Evelyn Greathouse, 55, of Elizabethtown, Indiana, has been accused in a civil lawsuit by her former
employer, LB Mold Inc., of embezzling as much as $2 million while she had served as its bookkeeper.
Greathouse currently also serves as clerk-treasurer of the municipality of Elizabethtown - a position she has
held for some 20 years. According to the lawsuit, Greathouse funneled company monies to her daughter and
son-in-law, Ronda Thompson and Dave Thompson, also of Elizabethtown. Some checks were made out to
Black Wolf Performance, an auto repair shop owned by Dave Thompson and Greathouse. There is a criminal
investigation ongoing, according to reports. She had been a bookkeeper for LB Mold for 13 years.
Elizabethtown had better start auditing its books...
Compiled by Brian Hudson
Former Municipal Adjuster In Texas Pleads Guilty To Embezzling Nearly $2
Million
Patricia A. Leathers, 62, of Garland, Texas, pleaded guilty charges she embezzled at least $1.9 million from
the City of Garland where she had served as municipal adjuster. According to prosecutors, Leathers, who
handled third-party liability claims against the city, submitted fraudulent claims for payments to herself and
to third parties which then collected or shared the proceeds over a period of more than 14 years, from
January 1994 until March 2008. One of Leathers' co-conspirators was her sister, Connie M. Powell, 59, who
plead guilty for her part in the conspiracy earlier this month. Some of the funds Leathers misappropriated
were federally granted. Leathers is scheduled to be sentenced on March 18, 2011.
Update (12/30/10): Leathers pleaded guilty today to charges she embezzled some $1.9 million from the City
of Garland, Texas. Sentencing is scheduled for March 18, 2011. She faces up to 5 years in prison.
Former Indiana State Trooper Accused Of Embezzling More Than $90K
Dallard Tackett, 59, of Nappanee, Indiana, has been accused of embezzling more than $90,000 from the
Indiana State Police where he had served as a State Trooper. According to a probable cause affidavit filed in
the criminal case against him, Tackett is alleged to have taken more than 28 checks intended for the state
police, endorsing them to himself and depositing them into accounts he controlled. Authorities allege that
Tackett used the stolen monies to pay for personal expenses, such as his mortgage car loan, credit card bills,
utilities and other personal bills.
Former County Employees’ Credit Union Exec In Texas Indicted For
Embezzling More Than $1.1 Million
Sandra H. Cooper, 56, of Orange, Texas, was indicted on charges she misappropriated $1,164,360 from the
Orange County Employees Federal Credit Union where she had served as president. According to
authorities, over a four and a half year period, Cooper wrote checks to herself from credit union accounts in
amounts generally ranging from $5,000 to $9,500 for her own benefit. Cooper was indicted on 14 counts of
embezzlement by an employee of a federally insured financial institution and 7 counts of money laundering.
Cooper faces up to 30 years in prison for each embezzlement charge and 10 years in prison for each money
laundering charge, if convicted.
Compiled by Brian Hudson
Former Treasurer In Upstate New York Pleads Guilty In $370K
Embezzlement Scheme
Gerard J. Whittington, Sr., 67, of Erie County, New York, pleaded guilty to charges he embezzled nearly
$370,000 from the Aurora-Colden Fire District where he had served as treasurer. Specifically, Whittington
pleaded guilty today to two counts of second degree grand larceny. Authorities believe Whittington had been
embezzling from the federally funded Fire District for at least 8 years, until he was terminated this past
summer and used the stolen funds to support his fire truck repair business operating. He allegedly wrote
checks to himself, his business or otherwise for his own benefit as well as made unauthorized credit card
purchases. Whittington has reportedly paid back some $271,989 but will face prison time and restitution for
the remaining amount outstanding.
Former Viginia Secretary of Finance Sentenced in $4 Million
Embezzlement Scheme
John W. Forbes, II, 54, of Richmond, Virginia, was sentenced to 120 months in prison for embezzling more
than $4 million from the Virginia Tobacco Indemnification and Community Revitalization Commission
while he had served as Secretary of Finance for the Commonwealth of Virginia. According authorities,
Forbes created fictitious entities, including the Community Development Council and International
Business Associates, to which he issued some $2.2 million in checks of public funds. He also oversaw a nonprofit entity, the Literary Foundation of Virginia, which received $5 million in state grant monies which is
also misappropriated from, according to authorities. Forbes must also pay restitution of $4 million.
Former Texas Municipal Manager, Brother Indicted In $4 Million
Misappropriation Scheme
Ronnie Cain, 60, of Windcrest, Texas and his brother, Gary Cain, 53, were indicted on charges they
conspired to misappropriate some $4 million from the City of Windcrest, where Ronnie Cain had served as
chief administrative officer and Rackspace Hosting, Inc., a local Internet hosting company. Gary Cain, a
developer, was alleged to have fraudulently received about $2.8 million from an account funded by the
company for Windcrest to use for infrastructure improvements.
Former Courthouse Worker In Alaska Pleads Guilty To Embezzling $237K
Katherine L. Turner, 39, of Fairbanks, Alaska, pleaded guilty to one count of first-degree theft, admitting
she embezzled some $237,000 from the Fairbanks Courthouse where she had been employed as a district
accounting supervisor. According to prosecutors, Turner misappropriated bail funds over a period of about
three years, beginning in 2007.
Compiled by Brian Hudson
Update: Former Vermont Town Treasurer Charged With Embezzling More
Than $400K
Donald Hewitt, 58, of Ira, Vermont, was charged with embezzling more than $400,000 from the Town of Ira,
where he had served as town treasurer. According to authorities, a town audit revealed discrepancies in
some of its accounts and implicated Hewitt in the misappropriation of $404,268. Hewitt reportedly admitted
to the thefts, which occurred over a 6 year period, in order to pay personal bills. Hewitt had been town
treasurer for 32 years. According to reports, Hewitt did the town bookkeeping out of his own home and
maintained the records there. We note that Hewitt was awarded the "Vermont Public Service Award" in 2005.
Wife Of Former New York Municipal Supervisor Pleads Guilty To
Embezzling $378K
Randi L. Matthews, 43, of Fairfield, New York, pleaded guilty to one count of grand larceny admitting she
embezzled some $378,000 from the City of Fairfield, where she was entrusted to manage the municipality's
finances by her husband, Francis Matthews, an elected Supervisor of the town. According to prosecutors,
over a three year period, from 2006 to 2009, Randi Matthews issued 347 unauthorized checks to herself or
her husband, totaling $377,976. She was originally charged last April with felony counts of grand larceny, 349
counts of forgery and tampering with public records. Authorities believe Randi Matthews then spent the
misappropriated monies at the Turning Stone Resort and Casino. She has blamed her actions on a gambling
addiction.
Deputy Treasurer In Ohio County Suspected In $150K Embezzlement
The Ohio State Auditor's Office released an audit report about its findings in the case involving Erie County's
former deputy treasurer, Tamara J. Holeton, 41, of Sandusky, Ohio, who plead guilty this past August on
charges she misappropriated $146,592 in funds that were meant to be deposited into county coffers. Holeton
plead guilty to theft in office and record tampering charges. The audit report made 7 specific management
recommendations to improve controls. According to reports, Holeton misappropriated the funds over a five
year period from 2005 until 2010.
Compiled by Brian Hudson