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Justice News

Department of Justice
U.S. Attorney’s Office
Western District of North Carolina

FOR IMMEDIATE RELEASE
Wednesday, February 21, 2018

Bookkeeper Pleads Guilty To Embezzling More Than $1.5 Million From Former Employer And Committing Tax Fraud

CHARLOTTE, N.C. – The former bookkeeper of a company located in Watauga Co. admitted in federal court today to embezzling more than $1.5 million from her employer and committing tax fraud, announced R. Andrew Murray, U.S. Attorney for the Western District of North Carolina. Connie S. Franklin, 58, of Boone, N.C. appeared before U.S. Magistrate Judge David C. Keesler and pleaded guilty to one count of bank fraud and one count of filing false tax returns.

U.S. Attorney Murray is joined in making today’s announcement by Reginald DeMatteis, Special Agent in Charge of the U.S. Secret Service, Charlotte Field Office (USSS) and Matthew D. Line, Acting Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI).

According to filed documents and today’s court proceedings, from 2008 until 2016, Franklin perpetrated a scheme to embezzle funds from the bank account of the company where she worked as bookkeeper, by falsely signing the names of the victim company’s executives to company checks made payable to herself. To conceal the fraud, Franklin then falsely coded the transactions as “freight” expenses in the victim company’s books and records. Court documents state that during the roughly nine-year scheme, Franklin embezzled approximately $1,595,472.82.

According to the filed charging document, Franklin also understated her taxable income by more than $1.4 million during the course of the scheme. For example, despite having a taxable income of $332,579 in 2015, Franklin reported an income of only $49,398. In total, court records show that Franklin understated her tax liability by more than $330,000.

Franklin is currently released on bond.  The bank fraud charge carries a maximum of 30 years in prison and a $1,000,000 fine. The maximum penalty for the charge of filing a false tax return is three years in prison and a $100,000 fine.  A sentencing date has not been set.

USSS and IRS-CI led the investigation. U.S. Attorney Murray also thanks the Boone Police Department and the Watauga County District Attorney’s Office for their significant assistance over the course of the investigation. Assistant U.S. Attorney Taylor J. Phillips of the U.S. Attorney’s Office, in Charlotte is in charge of the prosecution.

Updated February 21, 2018