One day, when Rita was out at a horse show, and Kathe was busy doing work and needed to do her treasurer’s report, she requested information from the bank. Pope: Kathe Swanson was the city clerk that reported to Rita. And just did that 179 times with phony invoices. She literally set up a bank account and moved money from one legitimate account into this secret account. It’s not an Enron-type scheme or extremely complicated. Especially when you don’t have a lot of internal controls around a process, it can easily happen. But, we all have a Rita in our organization - someone who we unconditionally trust - and when they tell us something, we don’t check up on it because we know them well. And like we say when I teach my forensic accounting class: Trust is not an internal control. Pope: I think it happened because everyone trusted Rita. A lot of people also ask now: Did she do it alone? How could one person do this? One, Dixon has this much money? It’s a really small town, and $53 million, even in a large city, is a lot. Pope: Well, there are several main questions. I mean, horse names like I Found A Penny and Careful Who U Invite? Those are some pretty interesting names. There were no questions about if she exuded wealth, because she definitely did. What this is is lifestyle fraud: She lived right out in the open. You don’t make a lot from it, but you put a lot of money into it. Kelly Richmond Pope: Her family showed horses, and she had this hobby, but the operative word is hobby. Pope, director of the documentary All the Queen’s Horses that chronicles the story, joined Morning Shift to discuss how Crundwell did it, how she got away with it for so long, and how fraud easily happens. But how it happened and why it happened wasn’t really discussed a lot. “As the story played out in the media, there’s so much focus on how this person steals this money, and buys horses, and lives this lavish lifestyle. “I was amazed at how one person could really do this,” Pope said Wednesday on Morning Shift. Rita Crundwell put her struggling small town of Dixon, Illinois, in the spotlight when the FBI arrested the former comptroller and treasurer for embezzling $53 million.Ĭrundwell, who was known for building a horse-breeding empire and throwing lavish parties, made headlines in 2012 as the mastermind behind the largest municipal fraud in American history, catching the attention of Kelly Richmond Pope, a CPA and accounting professor at DePaul University. Reviewed by Carrie Shepherd / WBEZ 91.5 Chicago
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