Former Mcmahan Fire Chief Paul Barth Guilty Of Embezzling And Laundering Over $198,000 From The Crusade For Children And The Mcmahan Fire Protection District
– Barth agrees to repay Crusade for Children $190,000
– U.S. recommends a 41 month prison sentence
LOUISVILLE, KY – David J. Hale, United States Attorney for the Western District of Kentucky today announced the guilty plea of Paul Barth, age 55, of Louisville, Kentucky to charges of defrauding the public, the McMahon Fire Protection District (MFPD) and the WHAS Crusade for Children of $198,277. Barth pled guilty to one count of mail fraud, two counts of wire fraud, and 12 counts of money laundering before United States District Judge John G. Heyburn, II in Louisville, Kentucky.
Conditions of the agreement require Barth to repay the Crusade for Children $190,000 in restitution, and $8,277 to the MFPD. At the time of sentencing, the United States will agree that a sentence of 41 months in a federal prison is the appropriate disposition of this case. The United States has agreed to dismiss Count 3 of the superseding indictment.
David J. Hale, U.S. Attorney for the Western District of Kentucky stated: “As district fire chief, Paul Barth occupied a position of significant responsibility and trust. As a volunteer leader with the Crusade for Children he accepted a similar position of trust with an important charitable organization that benefits thousands of disabled children and their families across the region. He abused both positions of trust he held in our community. Instead of safeguarding the money collected by the fire department for the Crusade for Children, he stole it and used it for his own personal benefit. If left unchecked, these deplorable actions could have caused devastating harm to the Crusade. Thanks to the work of the Secret Service and our other law enforcement partners, Barth’s actions were stopped. The plea agreement entered in federal court today will require the defendant to spend 41 months in federal prison and pay back the nearly $200,000 he stole. This is a just outcome.”
Special Agent in Charge, Paul R. Johnson, US Secret Service, Louisville Field Office: “This case demonstrates a truly disheartening incident where a person who is in a position of trust and authority abuses that trust in order to steal money, and does so by stealing from a children’s charity. The US Secret Service Electronic Crimes Task Force will continue to work aggressively with it’s state and local law enforcement counterparts to combat these crimes and to ensure that victims are made as whole as possible.”
According to the plea agreement, and information presented in court, between January 2001 through November 2009, Barth, while employed as the Chief of the McMahan Fire Protection District, defrauded the MFPD, and the WHAS Crusade for Children by taking for his own personal benefit and use, money donated to the Crusade through the MFPD. During the course of the scheme Barth caused approximately $218,995 to be deposited into a bank account that he solely controlled in the name of the Crusade. He then used the majority of these funds for his own benefit, including the payment of personal expenses that included Disney World vacations, Corvette Club expenses, and for payments to MFPD to cover funds that he fraudulently obtained from MFPD.
Between July 2002 through March 2009, Barth defrauded the MFPD by causing 13 additional paychecks totaling $36,645.89, payable to him, knowing that he was not entitled to the payments.
Between November 2007 through June 2009 Barth defrauded MFPD by fraudulently using a MFPD credit card to make personal purchase totaling $36,281.79. For example, on April 14, 2009, Barth used the MFPD credit card to pay $10,886.68 in vehicle property taxes to the Jefferson County Clerk, which caused an interstate wire communication between Louisville, Kentucky, and Addison, Texas.
Between May 2005 through November 2009, Barth knowingly laundered and concealed the proceeds of the money that he embezzled including 11 specific cash transactions over $10,000.
The 15 counts of the Indictment to which Barth pled guilty carry a combined maximum term of imprisonment of 190 years, a combined maximum fine of $4,000,000, and a three-year term of supervised release. There is no parole in the federal system.
Barth is scheduled to be sentenced at 1:30pm on October 4, 2012, before U.S. District Judge Heyburn, in Louisville, Kentucky.
The case is being prosecuted by Assistant United States Attorneys David Weiser and Bryan Calhoun. It was investigated by the United States Secret Service - Kentucky Electronic Crimes Task Force, which includes the University of Louisville Police Department, the United States Postal Inspection Service, and the Criminal Investigation Division of the Internal Revenue Service.