Former Administrator Pleads Guilty to Embezzling from Jackson County Court
|U.S. Attorney’s Office November 21, 2013|
KANSAS CITY, MO—Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that the former court administrator for the Jackson County Circuit Court pleaded guilty in federal court today to a fraud scheme in which the government contends she embezzled nearly $140,000 from the circuit court.
Teresa L. York, 58, of Blue Springs, waived her right to a grand jury and pleaded guilty before U.S. District Judge Howard F. Sachs to a federal information that charges her with mail fraud.
York was appointed as the court administrator for the Jackson County Circuit Court in 2003 and resigned on July 2, 2012, after her embezzlement was discovered.
York admitted that she engaged in a scheme to defraud the court between January 2009 and June 4, 2012, when she was placed on administrative leave. York used court-paid credit cards for her own personal use and purchased gift cards paid for by the court for her own personal use. According to the federal charging document, York also entered into a fraudulent contract for which no services were ever provided and which primarily benefited a person with whom she had a personal relationship. (York does not admit that conduct in today’s plea agreement, but the government reserves the right to present evidence of the contract fraud at her sentencing hearing.)
As a result of York’s fraudulent actions, the government contends the total loss to the court was $139,536, while the intended loss was $142,278. Under the terms of today’s plea agreement, York must pay a $77,778 money judgment to the government in forfeiture, which represents her proceeds from the fraud scheme.
Credit Card Scheme
The Jackson County Circuit Court used credit cards to pay for court business, such as judicial travel and Missouri Bar expenses. These credit cards were collectively referred to as purchasing cards, or “P-cards.” As court administrator, York was an authorized user of the P-cards.
York admitted that, from 2009 to 2012, she used the court’s P-card to purchase:
- $2,252 for gas for her personal driving, even though the court used mileage reimbursement forms to reimburse business driving;
- $9,532 for personal items and gift cards from Amazon;
- $6,446 for personal items such as clothing and makeup;
- $8,350 for personal meals;
- $487 for U.S. postal stamps for her personal use (the court uses metered postage for its mail, rather than stamps);
- $46,535 for Apple computer products (the court did not use a system compatible with Apple computers);
- $35,356 for gift cards. (York kept most of the gift cards, in the amount of $29,371, for her personal use and distributed $5,985 of these gift cards to court staff, on a merit system determined by her, as a type of bonus. The amounts of the cards were more than the Internal Revenue Service de minimis requirements for income reporting, however, the cards were not ever tracked or reported as income.)
York also sold some computers owned by the court and kept the proceeds of the sales for her personal use.
From January 2009 to June 4, 2012, York reimbursed the court a total of $1,660 for her personal expenditures. On June 7, 2012, after being confronted with her embezzlement scheme and placed on leave, York reimbursed the court an additional $2,742.
York admitted that the approximate intended loss to the court from her personal use of the court’s credit cards is $77,778, while the actual loss to the court from that part of her scheme is $75,036.
Today’s information also alleges that York engaged in a fraudulent contract scheme. On September 30, 2010, York entered into a contract with CBDM Services LLC on behalf of the court, purportedly for workflow analysis (a business process review, a customer service evaluation, and an organizational redesign). The amount to be paid was originally $68,000, although it was later increased to $69,500.
CBDM, which was not organized as a company at the time the contract was signed, was actually a front for the true contracting party, identified in court documents as “B.V.” York did not disclose to the court that B.V. would be receiving more than 90 percent of the payments made to CBDM or that she had a personal relationship with B.V.
At York’s direction, the court paid CBDM a total of $64,500, although no usable work product or report was produced. Of the $64,500 paid by the court, the owner and only principal of CBDM (identified in court documents as “N.D.”) kept approximately $2,000 plus banking fees and sent the remainder, approximately $62,000, to B.V.
Under federal statutes, York is subject to a sentence of up to 20 years in federal prison without parole, plus a fine up to $250,000. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Kathleen D. Mahoney. It was investigated by the FBI.