Tuesday, March 3, 2015

Texas Woman Setenced For Embezzling $366K From Bank

From the Statesman on 2/26/2015:

A Murchison woman has been sentenced to federal prison for embezzlement in the Eastern District of Texas, U.S. Attorney John M. Bales announced.

Deborah Cornett, 55, pleaded guilty June 9, 2014 to embezzlement by a bank employee and was sentenced to 41 months in federal prison February 17, 2015 by U.S. District Judge Leonard Davis. Cornett was also ordered to pay restitution in the amount of $365,988.43.

“The actual sentence is a function of several complicated factors but principally, in a case like that, it's going to be based on the amount of the loss,” Bales said. “She didn't have any criminal history so she benefited from that.” Bales explained the sentencing is more severe if a person has a prior criminal history.

According to information presented in court, from November 2007 to May 2013, Cornett was an officer and employee of the First State Bank of Ben Wheeler. During that time, Cornett embezzled from bank payroll accounts, the bank Christmas Club account, certificates of deposit, and from fraudulently issued bank loans.

“We'll virtually always prosecute folks who are in an officer capacity or have some sort of management responsibility at the bank and she certainly fell into that,” Bales said.

The 41-month sentence is based on the amount embezzled and the fact Cornett was considered a “person in trust” at the bank. Additional time is often added for the more elaborate schemes carried out by a person who has “taken advantage of their position.”

Bales went on to explain how embezzlement can occur at banks, especially smaller-town banks where everybody knows everybody and where something like this “would never happen.”

“In this case it looks like she understood how the accounting was on those certain accounts there, where they were. This happens a lot – where there are general accounts at the bank, where they sort of park money, or where there's accounts that there's little activity, nobody's really going to notice, and it looks like she took advantage of both of those situations to steal.”

Once Cornett finishes serving her time Bales said she will be on supervised release, be barred from any future banking jobs, and be required to continue paying restitution. The restitution will continue even after she completes her supervised release.

Cornett will be required to submit financial statements on any money earned, whether through a job, inheritance, lottery or gambling winnings or through savings accounts, real estate holdings or other personal properties. However, Bales said his office will not rely solely on her submitted statements.

“We have a financial litigation unit that's actually in Tyler and their job is to track down assets from here til Kingdom Come,” Bales said. “So she'll be dealing with this restitution long after she's served her sentence.”

Restitution, Bales explained, is based on the amount of loss related to the crimes of conviction “readily known about.”

Bales said his office “will not rest” when it comes to requiring a person to pay back restitution.
“The judgment is good for 20 years under the state law and we will actually move to extend that,” Bales said. “Somebody, long after I'm gone, will still be trying to collect that money because it does take a long time.”

It is important to collect the money, Bales explained, because in most instances it has already been spent before the person is caught.

While Bales' “name is on all the paperwork” and he is ultimately responsible for the prosecution, the actual case was worked by Assistant U.S. Attorney Nathaniel C. Kummerfeld, a “very good young prosecutor” according to Bales. This case was also investigated by the Federal Bureau of Investigation.

Bales and his office are happy with the outcome of the case.

“The case was resolved fairly and justly under the law and the facts,” Bales said. “Really it's a tragedy, it sounds like she was somebody who was trusted by the bank.”

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