Wednesday, February 07, 2018

Former Jasper R-5 Board Secretary pleads guilty to embezzling, faces up to 35 years in prison

Former Jasper R-5 School Board secretary Karla Jessee pleaded guilt today to embezzling more than $145,000 from the district.

The announcement of her guilty plea came on the same day her federal grand jury indictment for wire fraud and credit card fraud was unsealed.

Jessee could serve up to 35 years in prison without parole.

From the news release from the U. S. Attorney for the Western District of Missouri:

Justice was employed as the head bookkeeper, payroll secretary, superintendent secretary, and board secretary for the Jasper R-5 School District from 2009 until her resignation on Sept. 22, 2016. Justice’s positions with the school district gave her unrestricted access to the account and payroll systems for the school district, as well as the district’s petty cash checkbook and signatory authority for this account. Justice essentially had unlimited access to every aspect of the account and human resources functions for the district.

By pleading guilty today, Justice admitted that she embezzled a total of $145,726 from the school district from September 2013 to September 2016.

Justice admitted that she paid herself $80,858 in additional payroll above and beyond the amount allowed under her employment contract. As a result of the fraudulently received payroll, Justice also received an additional $6,731 in employer retirement contributions and $6,530 in Social Security and Medicare contributions that she would not have received otherwise.

The investigation also discovered numerous transactions involving the petty cash account, including checks and E-checks that totaled $13,929 in transactions that were conducted by Justice to pay for personal expenses that were unrelated to the activities of the district, and were not authorized by the district.

Justice also opened and used a Home Depot credit card in the name of the district, without authority or the approval of any district official. Justice used the fraudulently opened Home Depot credit card to conduct several personal purchases between Jan. 6 and Sept. 1, 2016, totaling $2,133.

The investigation revealed numerous checks that had been written on the operating account for the district. Justice did not have authority to write checks to this account but she did have access to the signature stamps for school officials, who did have signatory authority over this account. Several district employees informed investigators that Justice repeatedly asked them to cash checks for her. School officials told investigators that each of the checks discovered during the investigation were fraudulently created and Justice’s request that other employees cash these checks and give her the money was done to bypass safety measures created to prevent employees from directly cashing checks made out to themselves.

According to today’s plea agreement, school officials began analyzing the district’s budget when the district experienced financial difficulties. During this analysis, officials noted irregularities in payroll payments, unexplained credit card payments, and missing monies from the petty cash account. When asked to reconcile the irregularities, Justice immediately wrote out a letter of resignation.

Under federal statutes, Justice is subject to a sentence of up to 35 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendants will be determined by the court based on the advisory sentencing guidelines and other statutory factors. Sentencing hearings will be scheduled after the completion of presentence investigations by the United States Probation Office.

This case is being prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the U.S. Secret Service and the Jasper County, Mo., Sheriff’s Department.

Jasper R-5 Board of Education members kept the information about the theft of district money from the taxpayers for a year and a half, first revealing the theft in a release to staff members late last year, followed by a news release for the public.

District sources told the Turner Report that a conservative estimate of the amount stolen from the district is "hundreds of thousands."

The theft forced the district to make drastic cuts to program, which were never fully explained to patrons.


Anonymous said...

Why aren't safeguards in place to prevent this?
In any business there would be a book keeper and then another accounting firm that reviewed the books at least once a quarter to ensure this type of thing couldn't happen.
I don't have an accounting degree, but I know this would be the correct protocol.

Anonymous said...

Where were the auditors that audited the school's books yearly? This should have been caught before three years had passed (2013 - 2016)! Why did it take administrators and board members so long to figure out something was wrong?

Anonymous said...

Hope she likes prison. She deserves to be locked up.

Dusty Roads said...

Did the Indians get all of it ?