United States Attorney James T. Jacks
Northern District of Texas

WEDNESDAY, SEPTEMBER 2, 2009
http://www.usdoj.gov/usao/txn/

WOMAN SENTENCED TO 41 MONTHS IN FEDERAL PRISON
FOR EMBEZZLING MORE THAN $600,000 FROM HEALTH CLUBS
IN TEXAS AND OKLAHOMA

LUBBOCK, Texas — Emily J. Read, a/k/a Emily Joe Khalili Read, has been sentenced to 41 months in prison and ordered to pay more than $670,000 in restitution by U.S. District Judge Sam R. Cummings following her guilty plea in March to one count of money laundering and one count of uttering counterfeit obligations of the U.S., announced U.S. Attorney James T. Jacks of the Northern District of Texas. Judge Cummings ordered that she surrender to the Bureau of Prisons by September 25, 2009.

Emily Read admitted that from late 2002 through at least 2006, she embezzled more than $663,000 from a group of health clubs known generally as Reaction Fitness, that operated in Lubbock and Corpus Christi, Texas, and in Lawton and Tulsa, Oklahoma. Emily Read was employed by Reaction Fitness as a bookkeeper. Her then husband, Chad W. Read, assisted her in laundering more than $110,000 of the illegally obtained funds. Emily Read also passed counterfeit notes to a variety of retail stores in the Lubbock and Highland Park, Texas areas.

Chad Read pleaded guilty last week to one count of money laundering. He faces a maximum statutory sentence of 10 years in prison, a $250,000 fine, and has agreed to pay $110,817.74 in restitution. A sentencing date has not yet been set.

Many of the embezzled checks were laundered through the Read’s personal bank accounts disguised as tax payments to the Internal Revenue Service. Emily Read recorded these transactions in the books of Reaction Fitness as federal employment tax payments.

During the time period of the scheme, the Reads’ purchased a $1.2 million home that they lavishly furnished. Their purchases also included a $300,000 condominium in Dallas, motor homes and luxury vehicles. They shopped at expensive designer stores in Dallas and in Beverly Hills, California, and Emily Read spent thousands of dollars on Jimmy Choo shoes.

The case was investigated by the Internal Revenue Service - Criminal Investigation and the U.S. Secret Service. Assistant U.S. Attorney Paulina Jacobo of the Lubbock Division of the U.S. Attorney’s Office, Northern District of Texas, prosecuted the case.

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