Criminal Justice News

Friday, June 15, 2012

Hampstead Fraudster Sentenced to 44 Months in Prison for Embezzling Over $313,000 from Her Employer

Also Filed a False Tax Return That Failed to Claim the Embezzled Funds

BALTIMORE—U.S. District Judge Benson E. Legg sentenced Sandra Iris Klaus, age 47, of Hampstead, Maryland, today to 44 months in prison, followed by three years of supervised release, for mail fraud, aggravated identity theft, and filing a false tax return in connection with a scheme to steal $313,000 from her employer and use her employer’s identity to obtain a mortgage. Judge Legg also ordered Klaus to pay restitution of $274,162, which she stole from her employer, and $111,780 to the IRS.

The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Richard A. McFeely of the Federal Bureau of Investigation; and Special Agent in Charge Rick A. Raven of the Internal Revenue Service-Criminal Investigation, Washington, D.C. Field Office.

“IRS-Criminal Investigation views embezzlement schemes as a form of organized tax evasion,” said Special Agent in Charge Rick A. Raven. “Today’s sentence ensures the public that offenders of these types of schemes are being caught and punished.”

According to Klaus’ plea agreement, from March 2005 to March 2011, Klaus was employed by a roofing and sheet metal company located in Westminster, Maryland, as an administrative assistant and bookkeeper. Klaus was responsible for preparing and submitting the employee weekly payroll and issuing checks to pay vendors. From January 2007 to March 23, 2011, Klaus caused payroll checks to be issued to a fictitious employee, checks which Klaus then endorsed and cashed. Between January 2007 and March 2011, Klaus cashed 206 weekly paychecks that she fraudulently caused to be prepared, for a total loss to her employer of $110,110.87.

Klaus admitted that she also diverted company funds to pay her personal credit card bills and used a rubber stamp with the name of an authorized company signatory printed on it to sign company checks for her personal benefit. Klaus also inserted her name as payee on checks that were signed by an authorized person and given to Klaus to make payments for the business. Finally, Klaus used the company credit cards to make unauthorized purchases for her personal use and benefit. Using these schemes, from 2008 through March, 2011, Klaus fraudulently caused the company to make $203,114.69 in payments on her behalf.

In an effort to conceal the scheme, Klaus made entries into the company’s accounting software system to disguise checks she sent from the company’s bank account to pay her credit card bills as payments to legitimate vendors. Klaus also secretly set up a connection from her personal home computer to the company computer server so that she could make fraudulent entries into the company’s accounting system from home.

Further, on September 10, 2009, Klaus submitted a letter on the company letterhead in support of an application for a mortgage to purchase a home located in Hampstead, Maryland. Klaus made several false statements in this letter, including that she was guaranteed a minimum annual bonus of $10,000 each year. Klaus signed the letter as the president of the company for whom she worked, without his knowledge or permission. Based on the information submitted by Klaus, including the fraudulent letter of support, Klaus obtained a mortgage loan of $266,055.49.

Finally, Klaus admitted that she filed false tax returns for tax years 2007 through 2010, substantially underreporting her income in those tax years because she did not include any of the funds stolen from her employer. The total tax loss resulting from the Klaus’ illegal conduct is $111,780.

United States Attorney Rod J. Rosenstein praised the FBI and IRS-Criminal Investigation for their work in the investigation and thanked Assistant United States Attorneys Gregory R. Bockin and Martin J. Clarke, who prosecuted the case.

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