Kathleen Louise Sammons Arraigned and Pleads Guilty in U.S. Federal Cour
The United States Attorney's Office announced that during a federal court session in Missoula on March 29, 2011, before U.S. Magistrate Judge Jeremiah C. Lynch, KATHLEEN LOUISE SAMMONS, a 52-year-old resident of Charlo, was arraigned and pled guilty to embezzlement from a credit union and money laundering. Sentencing is set for July 6, 2011. She is currently detained.
In an Offer of Proof filed by Assistant U.S. Attorney Kris A. McLean, the government stated it would have proved at trial the following:
SAMMONS began working for the Polson branch of the Whitefish Credit Union as a teller in 1996. She began embezzling cash from her teller drawer in 1998. SAMMONS was promoted to Polson Branch manager in 2009-her embezzlement continued in this new position until a surprise cash audit on June 23, 2010, uncovered her scheme. The cash audit determined the Polson branch vault was approximately $676,000 short.
When confronted by Federal Bureau of Investigation and Internal Revenue Service agents on July 26, 2010, SAMMONS confessed to stealing the money and described her methods. SAMMONS explained that each day a cash count was conducted during which two credit union employees counted the cash in the vault and in the teller drawers. SAMMONS would complete the first columns of the vault balancing sheet, which included the cash counts with a second teller. Then SAMMONS would have the other teller initial off on the form. SAMMONS would then complete the vault balancing sheet by herself so that it balanced to the general ledger. In order hide her theft, SAMMONS would white-out the numbers for the cash counts in the first two columns that were witnessed by the second teller. SAMMONS would then place numbers in these columns over the whited-out numbers that matched the general ledger balances. SAMMONS kept the original vault balancing sheets in her office and sent copies to the accounting department via fax so the white-out would be hidden.
SAMMONS kept her own accounting of the amount of money she had stolen over the years. When the rare cash audit occurred, SAMMONS was advised and took steps to hide her theft of cash from the vault. SAMMONS would make cash withdrawals from a high balance customer's account by debiting the customer's account and then she would credit the vault cash account in the same amount. This was a paper transaction designed to lower the general ledger balance of the vault cash to cover up the cash taken by SAMMONS. As soon as the auditors left, SAMMONS would reverse the general ledger entry.
With specific regard to the money laundering charge, Credit Union records and SAMMONS confession confirmed that she conducted just such a "transaction" on August 23, 2007, when she made a general ledger entry withdrawing $210,000 from a credit union customer's account and added the funds into the vault cash account. On August 27, 2007, SAMMONS reversed the general ledger entry. When interviewed by the FBI, the customer explained that he did not authorize anyone to withdraw cash from his account and, in fact, had no idea such a transaction had occurred.
SAMMONS not only admitted stealing approximately $676,000 from the Whitefish Credit Union, but described her use of the stolen money to federal investigators. SAMMONS explained that among other expenditures, she made loan payments for credit union customers, made donations to local charities, paid for high school sports banquets and trips, bought a house in Dillon, covered thefts of cash by other credit union employees and in general enhanced her personal income.
SAMMONS faces possible penalties of 30 years in prison, a $1,000,000 fine and 5 years supervised release.
The investigation was a cooperative effort between the Federal Bureau of Investigation and the Criminal Investigation Division of the Internal Revenue Service.
A copy of the Offer of Proof can be obtained by contacting Sally Frank at (406) 247-4638.