Monday, October 27, 2014

Missouri Woman Pleads Guilty To Embezzling $3 Million From Local Manufacturer - Company Forced To Go Bankrupt & Shutter

From the Associated Press on 10/22/2014:

A Kansas City woman has pleaded guilty to a $3 million fraud that forced her employer to declare bankruptcy and close the business.

Federal prosecutors say 52-year-old Irene Marie Brooner pleaded guilty Wednesday to bank fraud. She admitted that for more than a decade she took the money from Galvmet Inc., a sheet metal fabrication and steel service center in Kansas City. The company closed in 2014, when it had 18 to 20 employees.
Brooner was a controller who managed payroll and accounts at Galvmet. During the scheme, she created 389 unauthorized transactions from the company's bank account to her personal account and increased her net pay on about 108 checks.
Brooner was ordered to forfeit her home, a Lexus, jewelry and at least $2.9 million.

From the Kansas City Star on 10/22/2014:

A 52-year-old certified public accountant pleaded guilty Wednesday to a $3 million fraud scheme that forced her former employer, Galvmet Inc., out of business.

The Kansas City woman, Irene Marie Brooner, who appeared in U.S. District Court for the Western District of Missouri, will forfeit personal assets and a money judgment equivalent to more than $2.9 million obtained in the scheme.

She also faces a possible sentence of up to 30 years in federal prison and an additional fine of up to $1 million.

According to U.S. Attorney Tammy Dickinson, Brooner worked at the Kansas City sheet metal fabrication and steel service company from 2001 until she was fired in February 2014. She had been the company’s controller in charge of managing payroll and accounts receivable and payable.
Brooner admitted in court that she created hundreds of unauthorized bank transactions, directing Galvmet funds to her personal accounts. She also admitted to increasing her pay by manipulating the company’s payroll account.

Brooner’s embezzlements, causing more than $1.89 million in losses to Galvmet, were discovered by the company when it prepared a Chapter 13 bankruptcy filing in February this year. Company sales had fallen from a peak of $14 million in 2008 to $10 million when it ceased operations, causing the loss of about 20 jobs.

Dickinson said Brooner also was discovered to have falsified documents with Missouri Bank & Trust, causing a $1.1 million loss to the bank.

Court filings indicated that Brooner used the embezzled funds to pay for a Lexus sport utility vehicle, pay off her home mortgage, remodel and extravagantly outfit a basement bar, spend about half a million dollars on clothing and jewelry, eat in restaurants, travel, go to spas and beauty salons, pay for gifts and school tuition for her children, and spend a half million dollars on undetailed check and credit card purchases.

The plea agreement requires her to forfeit the Lexus and jewelry and pay a money judgment of at least $2.96 million, representing the total net proceeds of her scheme.
The case was investigated by the FBI and prosecuted by Daniel M. Nelson.

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