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Horse Breeder Accused of Misappropriating $30 Million

Horse Breeder Accused of Misappropriating $30 Million

Rita Crundwell, a high-profile breeder of champion Quarter Horses, is facing federal charges for allegedly misappropriating millions of dollars in municipal funds while serving as comptroller for a small town in Illinois.

Crundwell is the owner of the Meri-J Ranch in Beloit, Wis., and operates another horse farm in Dixon, Ill. Jim Bret Campbell, director of marketing and publications for the American Quarter Horse Association (AQHA), said that Crundwell earned Leading Breeder Award honors at eight AQHA World Championship Shows. She was a member in good standing of the AQHA, but never served as a director or in any other leadership position for the organization, Campbell said.

Assistant United States Attorney Joseph C. Pedersen said Crundwell was appointed to her $80,000 annual salaried position as comptroller of Dixon, Ill., in the early 1980s. As comptroller, Crundwell handled all the city's finances, he said. On April 17, FBI agents arrested Crundwell for allegedly defrauding the city of Dixon of $3.2 million in funds just since the fall of 2011. In all, prosecutors accuse Crundwell of misappropriating more than $30 million in city revenue between 2006 and 2012. She is charged with one count of wire fraud, Pedersen said.

Crundwell was unavailable for comment.

Pedersen said prosecutors allege that Crundwell funneled revenue from several bank accounts owned by the City of Dixon into a Capital Development Fund also owned by the city, then used some of those funds to underwrite her personal and business expenses at her horse farms. The alleged misappropriations came to light in October 2011 after a Dixon city employee temporarily filling in for the vacationing Crundwell reviewed all the city's bank statements and brought activities on the particular account to Mayor James Burke's attention. Burke subsequently reported Crundwell to law enforcement authorities, Pedersen said.

According to the complaint, a joint holder of that Capital Development Fund account is listed as RSCDA, and that checks written on that account list the account holder as "RSCDA, C/O Rita Crundwell." The complaint alleges that between September 2011 and February 2012, approximately $2,783,912 in various tax funds were deposited electronically into one of the city's accounts. Crundwell allegedly moved these funds around to other bank accounts held by the city and eventually allegedly transferred most of these monies into the Capital Development Fund account. Between September 2011 and March 2012, in her capacity as comptroller, Crundwell allegedly wrote 19 checks totaling $3,558,000 on the Capital Development Fund account payable to "Treasurer," and deposited these checks into the account listing RSCDA as the joint account holder. She then allegedly took $3,311,860 from the RSCDA account by checks and online withdrawals, using only $74,274 for the city's operations. Crundwell allegedly used the remainder of those funds, more than $3.2 million, for her own personal and business expenses, including approximately $450,000 relating to her horse farming operations, $600,000 in online credit card payments, and $67,000 to purchase a 2012 Chevy Silverado pickup truck.

Additional bank records obtained by the FBI show that between July 2006 and March 2012, Crundwell allegedly deposited a total of $30,236,503 in city funds into the RSCDA account, and paid out more than $30 million for her own personal and business expenses, Pedersen said.

If convicted, Crundwell could face maximum penalties of up to 20 years in prison and a $250,000 fine, or an alternate fine totaling twice the cost of the loss or twice the gain, whichever is greater.

Source: The Horse.com

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