Former Office Manager Sentenced for Wire Fraud and Filing a False Tax Return Related to Embezzlement of Funds
DENVER – Kimberly Pitts, age 48, of Pueblo, Colorado, was sentenced late last week by U.S. District Court Judge Philip A. Brimmer to serve 41 months in federal prison, followed by 3 years of supervised release for wire fraud and filing a false tax return, U.S. Attorney Bob Troyer, IRS Criminal Investigation Special Agent in Charge Steven Osborne and FBI Denver Division Special Agent in Charge Calvin Shivers announced. Pitts, who pled guilty on July 28, 2017, was also ordered to pay restitution of $768,439 to victim Associates in Gastroenterology (AG) and $382,014.58 to the Internal Revenue Service.
According to the information and plea agreement, Associates in Gastroenterology (AG) hired Pitts as their office manager in February of 2011. Beginning in approximately February of 2011 and continuing through May 30, 2015, Pitts fraudulently diverted funds in the amount of at least $768,439 from AG to herself. Pitts used various methods to divert the funds including making personal charges on credit cards belonging to AG, then using AG’s bank accounts to pay the credit card charges. In addition, Pitts used her access to obtain a new AG credit card without the company’s authorization. She fraudulently used the new credit card to pay for personal purchases. Pitts further wrote fraudulent checks from AG’s bank account, which she deposited to her own accounts and concealed the payments by changing the company’s books and records to reflect that they were payments to vendors. Pitts also wired funds from AG’s bank and retirement accounts into her bank accounts for her personal use.
Pitts willfully and knowingly filed a false federal income tax for the 2014 tax year. Pitts signed the return, under penalties of perjury, knowing that the return was false because it did not include the income she received during the 2014 tax year as a result of the scheme to defraud AG.
“Our prosecutor and our IRS and FBI partners did an exceptional job ensuring that this thief’s victims – including American taxpayers – got justice in this case,” said U.S. Attorney Bob Troyer.
“The role of IRS Criminal Investigation becomes even more apparent in embezzlement and fraud cases due to the complex financial transactions that must be unraveled," said Steven Osborne, Special Agent in Charge, IRS-Criminal Investigation, Denver Field Office. "The federal tax laws are normally violated in these cases which can add to additional jail time. As we often see, the victims are not only the taxpayers, but also the individuals and entities who suffer the financial harm.
“The recent sentencing of Kimberly Pitts should send a strong message to anyone considering engaging in embezzlement or wire fraud,” said FBI Denver Special Agent in Charge Calvin Shivers. “The FBI will continue to work with our law enforcement partners to protect our community’s businesses from those engaged in this type of criminal activity."
This case was investigated by the FBI and the Internal Revenue Service – Criminal Investigation. This case was prosecuted by Assistant U.S. Attorney Jeremy Sibert.