Thursday, October 30, 2014

Former CFO of Kansas City Company Sentenced to 2 Years for Embezzling $338K

From the Kansas City Business Journal on 10/29/2014:

James Kilkenny of Kansas City, the former CEO and CFO of Waechtersbach USA Inc., was sentenced to two years in prison and ordered to pay $338,221 in restitution after being convicted for a wire fraud scheme.

Kansas City-based Waechtersbach USA is a distributor and vendor that buys German and Asian products and distributes them to U.S. retailers.

Kilkenny, who pleaded guilty to wire fraud in April 2014, admitted to overpaying his salary and using company money for personal expenses over a nine-year period. He disguised the overpayment as warehouse and office expenses.

Kilkenny also used company funds to pay back personal loans and to pay for his dependents' health insurance without authorization. He also used the company's travel credit card for personal, local expenses.

The embezzlement came to light when the owner of the company was notified by the U.S. customs department that the company received an $80,000 import tax refund. The owner became suspicious and an internal investigation revealed Kilkenny received the $80,000 refund, but reported that the refund was for only $8,000. Kilkenny instructed the employees in the Kansas City office to lie about the amount if asked.

The company then began investigating all of Kilkenny's spending and discovered the extent of the embezzlement.

No comments: