Saturday, December 6, 2014

Pennsylvania Woman Sentenced To 2 Years For Embezzling $300K From Law Firm

From the Pittsburgh Post-Gazette on 12/6/2014:

Debra Feather worked 41 years for the McDonald Snyder & Lightcap law firm in Latrobe, where she handled the books with the complete trust of the partners.

But for 12 of those years she was abusing that trust, systematically stealing $300,000 from the firm and using it for personal expenses, including credit card bills and Pirates tickets.

Friday a judge sent her to prison for two years for evading income taxes on $150,000 of what she pilfered.

U.S. District Judge Arthur J. Schwab imposed that term despite her lawyer’s plea for probation based on the fact that she’s 63, has health problems, lost her job at the firm and suffered “embarrassment and humiliation” from her crime.

Assistant U.S. attorney Leo Dillon argued for prison, saying probation is not appropriate in federal tax cases because it undermines the effectiveness of the IRS.

“The only way to deter criminal tax violations is via sentences of imprisonment,” he told the judge in a pre-sentence filing.

Feather pleaded guilty in August to tax counts pertaining to failure to pay taxes on the $150,000 she stole from 2007 to 2010, although the U.S. attorney’s office said the total loss was $300,000 dating to 1998. The tax loss to the government was about $84,000 for those 12 years.

Feather handled payroll at the firm for years without suspicion until she broke her leg in 2010. Laid up at home in traction, she couldn't make it to work to write payroll checks. So one of the partners, Donald Snyder, and an accountant took over.

In going through the books, Mr. Snyder discovered an IRS deficiency notice indicating a penalty had been imposed for failure to deposit payroll taxes for the first quarter of 2010.

He looked closer and found checks that were written to people who had no business with the law firm. Feather, it turned out, had been looting the firm for years by writing checks to herself, forging endorsements on other checks and falsifying records.

Mr. Snyder fired her and called local police. The case was eventually turned over to the criminal investigation division of the IRS to pursue tax charges rather than theft offenses, which would be a state crime.


Read the whole story here.

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