CU Manager Uses Tax Dollars to Hide Embezzlement
Two former employees of the $4.2 million Milledgeville Community Credit Union in Milledgeville, Ill., who embezzled more than $320,000 will be sentenced in May and June in two separate federal cases, said Zachary T. Fardon, U.S. Attorney for the Northern District of Illinois in Chicago.
In the first case, Kimberly Kent, 53, a former manager of the cooperative, pleaded guilty Feb. 24 in U.S. District Court in Rockford to embezzling more than $219,000 and used local taxpayer dollars to cover up her fraud.
According to court documents, Kent was elected treasurer of Wysox Township in 2009. She removed $175,000 from a Wysox Township account to cover up the money she had embezzled from Milledgeville Community CU.
The taxpayer monies taken from Wysox Township came from various funds that supported the local government’s operations.
Between 2010 and February 2012, Kent concealed her embezzlement by, among other things, moving money in and out of Wysox Township’s account at Milledgeville Community CU, court documents show.
Kent embezzled credit union funds from October 2005 to February 2012.
Before using taxpayer funds to conceal her scheme, Kent covered up her fraud by creating fictitious loans using names of family members and fictitious certificates of deposits, according to court papers.
In the second case, Kelsey Selman, 37, pleaded guilty Feb. 24 to embezzling more than $100,000 from the 869-member Milledgeville Community CU, where she worked as a teller.
From early 2007 to early 2012, Selman covered up her fraud by using the credit union’s computer system to apply credits to her personal account, according to court documents. The credits, however, did not have corresponding deposits. As a result, the credit union’s records falsely reflected that Selman’s cash drawer increased by an amount to offset the deposits into her account.
Both women used the money they stole to pay for personal expenses.
Kent and Selman, however, repaid the credit union all of the funds they embezzled, federal prosecutors said.
The former credit union employees each face a maximum of 30 years of imprisonment and up to five years of supervised release following imprisonment. They each may be fined $1 million.
Sentencing for Kent is scheduled for June 2 and sentencing for Selman is set for May 7.
The Milledgeville Community CU case is at least the third embezzlement/fraud incident that has involved Illinois credit unions so far this year.
On Feb. 14, Anne Schaal, the former president/CEO of the $1.9 million, 492-member Aurora Firefighters Credit Union, pleaded guilty to embezzling more than $36,000 from the Aurora, Ill.-based institution.
In January, four Illinois men were charged with bank fraud charges in a luxury car loan scheme that defrauded four credit unions out of $914,000, according federal prosecutors in Chicago.
The men, who are not credit union employees, stand accused of fraudulently securing at least 28 automobile loans from the $643 million Great Lakes Credit Union in North Chicago, the $30 million Sherwin-Williams Employees Credit Union in South Holland, Ill., the $745 million Credit Union 1 in Rantoul, Ill., and the $16 billion Pentagon Federal Credit Union in Alexandria, Va.