January 25, 2021

Accountants Behaving Badly: E Is for Embezzlement, Probation for Thief, Jailed for Bank Fraud

Also, a Texas accountant was sentenced to 10 years of probation for stealing money from a charity, and a U.K. accountant sentenced to three years in jail for defrauding a company pension scheme of £292,000 must repay that money.

Kissimmee Accountant Pleads Guilty To Embezzling Funds From Two Different Employers [Justice Department]
Kavita L. Harack, 34, faces a maximum 20 years in federal prison after pleading guilty on Oct. 22 to committing wire fraud.

According to the DOJ:

In approximately May 2017, Harack was hired to work as an accountant in the Orlando office of a display services company. Between April 2018 and May 2019, Harack directed 74 fraudulent payments from the display services company to four bank accounts held in her or her husband’s name. Harack disguised the transfers to these personal accounts as vendor payments. After Harack was terminated by the display services company in May 2019, she was hired to work in the accounting department of a project design company in Orlando. Between July 2019 and December 2019, Harack directed four fraudulent payments from the project design company into two of her personal accounts, again disguising the transactions as vendor payments.

In total, between 2018 and 2019, Harack fraudulently paid herself $604,637.25 from accounts belonging to her employers. Harack used the funds to purchase a home, as well as home improvement projects, travel, retail purchases, restaurants, and beauty expenses.

Duluth accountant placed on probation, ordered to repay $357,000 in restitution [Duluth News Tribune]
Jesse Frye, who owned Eagle Accounting in downtown Duluth, MN, was placed on three years of supervised probation on Nov. 9 after admitting to stealing money from the Duluth Area Chamber of Commerce and another local business that has not been identified.

Jesse Frye

Frye, 40, who was arrested in January and spent three days in jail, will avoid any further incarceration under the plea agreement with the St. Louis County Attorney’s Office. However, he must pay back a total of $357,881 and complete 90 hours of community service, among other conditions.

Frye did, however, make an initial lump-sum payment of $300,000 that will cover a good chunk of his court-ordered restitution.

Frye pleaded guilty to felony theft charges in two separate cases on Oct. 2.

Former Savannah finance company employee sentenced to federal prison for bank fraud [Justice Department]
Dean Flake, 58, a former accountant at a finance company in Savannah, GA, was recently sentenced to 20 months in federal prison followed by 13 months of home confinement for committing bank fraud.

Per the DOJ:

According to court documents and testimony, Flake was employed for nearly 35 years as an Accounts Payable Processor at a finance company in Chatham County. In 2019, he began forging signatures on checks drawn on the company’s checking account and depositing them in his own account.

By the time his scheme was detected, Flake had stolen more than $1.6 million from his employer. The government identified, seized and forfeited $975,138.79 from the scheme, and after his arrest Flake admitted to stealing the money to feed a gambling addiction.

Former Rodeo Austin accountant pleads guilty to $1.3M theft, sentenced to probation [KXAN]
Mark Weston, a former Rodeo Austin financial manager who was accused of stealing more than $1 million from the Austin, TX-based nonprofit charity and faced up to 99 years in prison for first-degree felony theft of property, pleaded guilty last month and will serve 10 years of probation.

Mark Weston

His sentence comes nearly four years after Rodeo Austin officials initially discovered “discrepancies” in their financial accounts in mid 2016. Weston, a CPA and the nonprofit’s financial manager at the time, later admitted he had misappropriated the funds and agreed to pay back $850,000, according to a 2017 legal agreement he signed.

As part of his plea deal, Weston agreed to pay $120,000 in restitution to Rodeo Austin, to stay away from the organization, not to handle a third party’s money as part of his employment, and to disclose his probation to future employers.

Accountant ordered to repay £292K fraud [Accountancy Daily]
Roger Bessent, an accountant convicted of defrauding a company pension scheme of £292,000, has been ordered by a judge to repay the money.

Bessent was sentenced in March 2019 to more than three years in jail, following a prosecution by The Pensions Regulator (TPR).

He was found to have taken savers’ cash from the Focusplay Retirement Benefit Scheme (FRBS), for which he acted as a trustee and administrator, and transferred it into businesses he part-owned and which were run by his family and a client.

At a confiscation hearing at Preston Crown Court brought by TPR, the judge ordered Bessent to pay a total of £274,733. Of this amount, £233,317 will be returned directly to the FRBS as part of a compensation order, which accounted for the difference between the sum stolen and the amount he has previously repaid.

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1 Comment

  1. Re: Former finance company employee sentenced to federal prison for bank fraud

    Dean Flake worked as a senior accountant at an accounting firm according to his LinkedIn profile. This story contains “fake news”…

Comments are closed.

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