Remaining Charges Dropped Against Ex-Dixon Comptroller

Prosecutors on Tuesday dropped all remaining charges against a former city comptroller who recently began serving a lengthy federal prison sentence for stealing nearly $54 million from her northern Illinois community.
Lee County State’s Attorney Anna Sacco-Miller dropped the 60 state counts of felony theft that remained against former Dixon comptroller Rita Crundwell. The prosecutor explained that the state case would have cost taxpayers more money and would not have resulted in additional prison time because any sentence would have to be concurrent with the federal punishment.
Crundwell, who was Dixon’s longtime bookkeeper, admitted in federal court in November that she stashed public money in a secret bank account for about two decades and used it to fund her lavish lifestyle and her renowned horse-breeding operation. The money went toward everything from expensive horse trailers and luxury motor homes to jewelry and birthday bashes in Venice Beach, Fla. It ranks as one of the worst abuses of public trust in the state’s corruption-rich history.
Because Crundwell had sole control of the city’s bookkeeping, the theft went unnoticed for years, even as the city’s financial shape suffered, with streets and equipment falling into disrepair and city employees going without raises. There wasn’t even enough money to mow the grass at the cemetery.
The scheme unraveled only when a colleague who filled in for her when she went on an extended vacation became suspicious.
Crundwell was sentenced in federal court in February to nearly 20 years in prison. Her attorney in the state case, Bob Thompson, had argued that subjecting her to another trial would amount to double jeopardy.
The state case covered only the period from January 2010 until Crundwell’s arrest in April 2012, during which time she was accused of stealing about $11 million.
Dixon Mayor Jim Burke said he had wanted to see Crundwell back in court, but that he agreed with the state’s attorney’s reasoning.
“She probably made a wise decision in just dropping the whole thing rather than spending money just to get some kind of emotional satisfaction out of the fact that we’re trying to nail Rita’s hide to the door one more time,” Burke said.
Sacco-Miller said the state charges could still be re-filed if Crundwell’s appeal of her federal sentence is successful.
The 60-year-old Crundwell is jailed in Boone County pending her assignment to a federal prison. She did not appear at Tuesday’s hearing.
Copyright Associated Press

Source: http://www.nbcchicago.com/news/local/Remaining-Charges-Dropped-Against-Ex-Dixon-Comptroller-205430731.html#ixzz2S51UjOKB

Dixon lawmaker introduces bills to stop a Rita Crundwell repeat

DIXON (WREX) –
A Dixon state representative hopes some new Illinois legislation will keep a theft like Rita Crundwell’s from ever happening again. The new plan includes harsher penalties and more government oversight.

Lawmakers overwhelmingly passed three bills in the house. But there are concerns at least some of the legislation just adds more government to municipalities that already have oversight in place.

“That we have effective and strong prosecution at our disposal on the state level to make sure we can effectively deter this from happening and prosecute those who do it,” says Representative Tom Demmer.

He is a Dixon native helped introduce what’s being called the Anti-corruption Legislation. It was created after Rita Crundwell pled guilty to stealing $53 million as Dixon’s comptroller. One bill allows for forgery charges to be brought if an invoice or a receipt is counterfeited. The second establishes higher penalties for theft or misapplication of public funds.

“Both of those kind of recognizing that forgery is already illegal, theft is already illegal but when it happens with local government is has that added impact of harming people’s trust and confidence in local government. So we recognize that maybe those need a little more stronger teeth in prosecution,” says Demmer.

The third creates safeguards by making all counties and municipalities create a finance and audit committee which includes members of the government and the public. Winnebago County already has something like it, its called the finance committee.

“In some ways it would be redundant,” says Bill Crowley, Winnebago County auditor.

That’s because not only is each department audited and brought before that county committee. They have also gone a step farther.

“We have the checkbook online, you can go on our website and you can actually see the payments that we make to various vendors in real time,” says Crowley.

The bills are currently in the Illinois Senate. It still has to pass out of committee but senators should vote on the bills in May.

http://www.wrex.com/story/22081770/2013/04/25/dixon-lawmaker-introduces-bills-to-a-rita-crundwell-repeat

Dixon mayor to speak at Rita Crundwell sentencing

February 12, 2013 ( ROCKFORD, Ill.) — At least half a dozen public officials are expected to make victim statements at this week’s sentencing of a small-town Illinois bookkeeper who stole $53 million in public funds.

A government filing Tuesday says Dixon Mayor James Burke is among those who will describe how Rita Crundwell’s crimes devastated his northern Illinois community.
As the city’s longtime comptroller, Crundwell used the stolen money to fund her nationally renowned horse-breeding operation and luxurious tastes.

She’s scheduled to be sentenced Thursday in Rockford. The most the 60-year-old could face is 20 years in prison after pleading guilty in November to a felony count of wire fraud. A state case against her is still pending.

Prosecutors contend her case is one of the most egregious abuses of public trust ever in Illinois.

February 12, 2013 ( ROCKFORD, Ill.) — At least half a dozen public officials are expected to make victim statements at this week’s sentencing of a small-town Illinois bookkeeper who stole $53 million in public funds.

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A government filing Tuesday says Dixon Mayor James Burke is among those who will describe how Rita Crundwell’s crimes devastated his northern Illinois community.
As the city’s longtime comptroller, Crundwell used the stolen money to fund her nationally renowned horse-breeding operation and luxurious tastes.

She’s scheduled to be sentenced Thursday in Rockford. The most the 60-year-old could face is 20 years in prison after pleading guilty in November to a felony count of wire fraud. A state case against her is still pending.

Prosecutors contend her case is one of the most egregious abuses of public trust ever in Illinois.

Financial firm responds to city’s lawsuit

DIXON – CliftonLarsonAllen advised city officials in writing more than once that there was a problem with its lack of segregation of duties at City Hall, the company says.

The city has amended its lawsuit against CliftonLarsonAllen, one of the largest financial consultants in the United States, saying the company should have detected the theft of nearly $54 million by former comptroller Rita Crundwell.

“We believe we met our obligation to provide the city’s officials with information about its finances,” the company said in a statement to Sauk Valley Media.

Court documents revealed Crundwell used 179 phony invoices to steal city funds. The invoices lacked key information, such as the agency’s emblem or logo and a contact name and number of an employee who could be reached for questions.

While those and other examples should have raised suspicion, no evaluation or investigation was made of the phony documents by CliftonLarsonAllen for the past 21 years, the city government says in its suit.

The company also violated a federal statute by conducting an audit and not being an independent firm, the suit says. In other words, it was performing an audit on its own financial statements, since it compiled payroll and other city finances.

CliftonLarsonAllen denies it conducted audits for the city since April 2006.

Instead, their company spokeswoman says the firm was performing a compilation.

There are three level of financial reporting. A compilation is the lowest and involves strictly formatting financial data. The highest level of financial reporting is an audit, which involves study of the financial data presented.

“We provided the city audit services through April 30, 2005, and compilation services since April 30, 2006,” Jennifer Dirks said in a statement sent to SVM over the weekend.

“The contracts executed with the city and the reports issued on the financial statements of the city clearly described the services we were contracted to perform and did perform. The type of audits our firm performed through 2005 and the compilation services provided since 2006 did not require the sort of detailed testing needed to uncover the fraud or a forensic investigation to determine if the city’s comptroller Rita Crundwell was fabricating invoices.”

Documents dating back to 2006 from CliftonLarsonAllen on the city’s website refer to its reports as “compilation reports.”

Mayor Jim Burke declined to answer questions in regard to the city’s relationship with CliftonLarsonAllen, stating the city’s attorney Devon Bruce of Power, Rogers and Smith advised him not to make statements while litigation is pending.

According to the amended lawsuit, the firm determined it was not “independent” in 2005, according to nationally recognized accounting standards, which prevented it from performing the audit by federal statute.

The firm reached out to Janis Card Co., which had only two certified public accountants, little or no experience in performing municipal audits, and lacked the resources to perform the city’s audits.

A partner in the firm told Janis Card Co. that in return for signing the audit for the city, CliftonLarsonAllen would conduct and prepare the audit.

Further, CliftonLarsonAllen told the city it was doing only a compilation, meaning it provided financial statements for the audit, yet referred to their work as an “audit” in several emails to city supervisors that are listed in court documents.

In fiscal years 2010 through 2012, the firm billed the city $33,500, $34,750, and $37,000, respectively, for its work.

Janis Card Co. billed the city a total of $40,000 between 2006 and 2011. It also did not do the fieldwork or test fixed assets for the audit, according to the suit

The company said it will respond to these claims in proceedings.

“We are confident in the integrity and professionalism of the partners and employees of our firm,” the statement said.

“As accountants and financial services professionals dedicated to the highest level of client service, we take the fraud perpetrated by Rita Crundwell very seriously. We have been working with the City as it seeks to discover all of the facts that will describe what has happened in this case.

“CliftonLarsonAllen is one of the most respected firms in the country and we are committed to continuously enhancing our operations, performance, and practices to fulfill our responsibility to our clients.”

http://www.saukvalley.com/2013/01/14/financial-firm-responds-to-citys-lawsuit/apo2fy0/?page=1

How did Crundwell do it?

By: CBS 4 Newsroom
newsroom@cbs4qc.com

An amended lawsuit filed last month gives more details about how former Dixon Comptroller Rita Crundwell stole more than $53 million of city funds.

According to court documents, Crundwell wrote more than 179 fake invoices from the Illinois Department of Transportation over the past ten years. Totaling over $44 million.

The invoices did not include an official IDOT emblem nor any contact information.

Crundwell then independently wrote and signed all the checks, despite normal process calling for three signatures.

Despite all the red flags and phony documents annual audits failed to catch what Crundwell was doing.

Which has led Dixon officials to file a lawsuit against two accounting firms in excess of $53 million.

The next hearing in that case is scheduled in march

Dixon stuck with Crundwell legacy for now

I would like to nominate Rita Crundwell as Dixon’s person of the year. Who else did more to put our town on the map in 2012? Unfortunately, no one. I wish it weren’t true, but we must face the truth. She has made Dixon famous.

Of course, this nomination is not for her good works. We all know the story by now. As city comptroller, she ripped off the city of Dixon to a tune of $53 million. We’ll see very little, if any, of that money….

from http://www.saukvalley.com/2013/01/02/dixon-stuck-with-crundwell-legacy-for-now/akhy55r/

Rita Crundwell May Ask To Have State Charges Dropped

Dixon – The lawyer for former Comptroller Rita Crundwell may ask the state to drop its case against her even though she admitted to stealing $53 million from the city.

Crundwell faces 60 counts of theft in Lee County. She’s supposed to appear in court for those charges tomorrow. But, her lawyer asked for more time so the judge could consider dropping them.

He didn’t elaborate as to why.

Crundwell did plead guilty though to a federal charge against her. She’ll be sentenced for that in February.

http://mystateline.com/fulltext-news?nxd_id=371432

Rita Crundwell Items to Be Sold in Online Auction

DIXON (WIFR) — Know someone with the initials R.C.? Then there may be a few items worth checking out. The U.S. Marshals service is hosting another online auction this weekend of Rita Crundwell’s stuff.

Things like a monogrammed boulder and similar-looking sign. A leather saddle will also be auctioned off. The online auction begins Sunday and runs through Wednesday. So far, the U.S. Marshals service has recovered nearly $8 million from selling Crundwell’s property, but that is nowhere close to the $53 million stolen by the former Dixon comptroller.

Once the rest of Crundwell’s personal items are sold, U.S. Marshals will sell her homes and farmland. They’re currently accepting counter-offers on three pieces of property, through December 21st.

Another online auction kicks off this weekend to sell more of Rita Crundwell’s personal items. This monogramed boulder and sign are included.. As well as this rare leather saddle. The auction will run Sunday through Wednesday. To check out the auction, visit www.professionalauction.com/12RC_Assets.htm.

Rita Crundwell auction ends

CHICAGO (CBS) — The online auction of items from homes that once belonged to former Dixon Comptroller Rita Crundwell has ended.

The auction of furnishings in the Englewood, Florida home that belonged to Crundwell, generated nearly $100,000.

A table and 8 chairs brought in the largest amount, $11,000.

Furnishings at the home where Crundwell spent most of her time, in Dixon, sold for 181 thousand dollars.

A grand piano brought in the largest single amount, $4,500.

The sale of the furnishings and possessions sold earlier, including more than 400 horses and horse semen for a breeding program, brought in a total $7.4 million.

From cbsnews

A long way from the $53 million that Crundwell admits she stole, while serving as Dixon’s Comptroller.