California Man Admits to Aiding and Abetting a Wire Fraud Scheme During COVID-19 that Cost the Federal Government Over $100,000
SALT LAKE CITY -- Hailey Keele, age 35, of North Ogden, pleaded guilty to one count of mail fraud and one count of tax evasion in federal court Wednesday afternoon in connection with a $843,673 embezzlement scheme at the business where she worked.
In court documents filed Wednesday, Keele admitted that from July 2006 through about November 2014, the company she worked for gave her access to its online American Express credit card account. She prepared checks drawn on her employer’s bank account to American Express and presented the checks to the company’s business manager for signature. She did this under the pretense the checks would be used to pay the company’s American Express account.
Keele admitted she did not disclose that the company’s American Express account would be fully paid by automatic online payments she set up using her online access. She also did not tell the company that she intended to use the checks to American Express for payments for her personal American Express account. Relying on her representations and omissions, the business manager signed the checks. She admitted she used the funds to pay for personal expenses and sometimes withdrew the funds in the form of cash advances, gift cards, and credit balance refund checks from American Express.
As a part of a plea agreement reached with federal prosecutors, Keele admitted she committed mail fraud in furtherance of the scheme when she contacted American Express in August 2012 to request a credit balance refund check of $36,681.15. She received the check by mail. The tax evasion conviction involves tax returns she filed for tax year 2014. According to the plea agreement, Keele knew that she had obtained significant income through her fraud scheme. However, she did not report or pay taxes on any of the $377,789 in income she obtained in 2014 through the scheme. The total amount of income tax due on the unreported income was $100,300.
U.S. District Judge Dee Benson set sentencing in the case for Feb. 21, 2018, at 2 p.m. The potential maximum penalty for the mail fraud conviction is 20 years in federal prison. The tax evasion count has a potential penalty of five years in prison. She also agreed to forfeit all property acquired or traceable to her criminal conduct, including as money judgment of $843.673.
Special agents of IRS-Criminal Investigation investigated the case. Assistant U.S. Attorneys Carl D. LeSueur and Kevin L. Sundwall of the U.S. Attorney’s Office are prosecuting the case.