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Press Release

Corry Area Schools Federal Credit Union Manager Sentenced to Prison for Embezzling $741,362

For Immediate Release
U.S. Attorney's Office, Western District of Pennsylvania

ERIE, Pa. - A resident of Bear Lake, Pennsylvania, has been sentenced in federal court to 24 months in jail, to be followed by 5 years of supervised release, and was ordered to make restitution in the amount of $696,273.72 on her conviction of embezzlement of credit union funds, Acting United States Attorney Soo C. Song announced today.

United States District Judge David S. Cercone imposed the sentence on Karen Schenck, 50.

According to information presented to the court, from January 2008 through August 2015, while employed as the Office Manager/CEO for the federally insured Corry Area Schools Federal Credit Union in Corry, Ms. Schenck embezzled approximately $741,362.00. Ms. Schenck successfully embezzled the funds in a variety of ways. She made $268,402.25 in unauthorized or fictitious loans in the names of her family members, the proceeds of which she used for her personal benefit or to conceal out of balance conditions in various general ledger accounts. Ms. Schenck made over sixty fictitious deposits into her own account or the accounts of family members totaling approximately $317,897.00, which she used for her personal benefit. Ms. Schenck withdrew approximately $51,035.03 and $44,572.47 from two accounts without the authorization of the account holders. Ms. Schenk created approximately $42,118.07 in loans to herself and fabricated loan underwriting documentation to give the appearance that she would have qualified for the loans. Finally, Ms. Schenck used the embezzled credit union funds to pay off personal credit card balances and engaged in unauthorized credit card limits causing approximately $17.338.00 in losses to the credit union.

Assistant United States Attorney Marshall J. Piccinini prosecuted this case on behalf of the government.

Acting United States Attorney Song commended the Federal Bureau of Investigation for the investigation leading to the successful prosecution of Schenck.

Updated May 22, 2017

Financial Fraud