San Francisco Woman Sentenced to 30 Months in Federal Prison for Million-Dollar Embezzlement Scam, Tax Evasion

SAN FRANCISCO—Lily C. Aspillera was sentenced yesterday to 30 months in federal prison for embezzling approximately $1.77 million from a client of a major professional services firm and for not paying taxes on that stolen money, United States Attorney Melinda Haag announced.

According to court documents, Ms. Aspillera, 65, of San Francisco, was employed as an executive assistant at major professional services firm. In that capacity, Ms. Aspillera engaged in a scheme through which she embezzled approximately $1.77 million from the accounts of one of the client’s of her employer. Ms. Aspillera admitted to accomplishing her scheme through various unauthorized means, including: (1) writing more than $1,000,000 worth of checks that were drawn on the client’s accounts payable to herself and to “Cash”; (2) writing checks drawn on the client’s accounts payable to two of the client’s employees for amounts greater than they were due, then having those employees cash the checks and give the excess cash back to Ms. Aspillera, falsely telling those employees that the cash they were bringing back was so she could pay other employees; (3) writing checks drawn on the client’s accounts to pay hundreds of thousands of dollars worth of Ms. Aspillera’s and her family members’ American Express bills; and (4) writing checks drawn on the client’s accounts for Ms. Aspillera’s benefit. Ms. Aspillera used the stolen money to fund a $180,000 down payment on a $1.1 million home in the St. Francis Wood neighborhood of San Francisco and then to pay the mortgage on that home. She also used stolen funds to purchase two BMWs, more than $200,000 worth of jewelry, and to pay her personal credit cards bills, which included charges for international and domestic travel and stays at luxury resorts. Ms. Aspillera admitted to making several false statements to her supervisors and taking several steps to conceal her scheme during its course.

Ms. Aspillera also admitted that she willfully evaded a large part of the federal income tax due and owing by understating the joint taxable income on her federal income tax returns for calendar years 2005 - 2008. The income she failed to report consisted of the monies she converted to her own use by the means set forth above. In addition to being ordered to repay the $1.77 million she stole, Ms. Aspillera also was ordered to pay back taxes of $644,843.

Ms. Aspillera was indicted by a federal grand jury on November 12, 2009. She was charged with nine counts of mail fraud, in violation of Title 18, United States Code, Section 1341, and four counts of tax evasion, in violation of Title 26, United States Code, Section 7201. On April 16, 2010, Ms. Aspillera pled guilty to all 13 counts.

The Honorable Judge Susan Illston imposed sentence upon Ms. Aspillera, who was ordered to surrender to the Bureau of Prisons on January 14, 2011. Judge Illston also ordered Ms. Aspillera to serve a three-year term of supervised release following her release from prison.

Doug Sprague is the Assistant U.S. Attorney who is prosecuting the case with the assistance of legal assistants Jennifer Hiwa and Rayneisha Booth. The prosecution is the result of a one-year investigation by the Federal Bureau of Investigation and the Internal Revenue Service - Criminal Investigation.