U.S. Attorney's Office
Central District of California
(213) 894-2434
May 4, 2015

Ex-Controller of Court Services Firm Who Embezzled More Than $3.3 Million Sentenced to More Than Three Years in Federal Prison

SANTA ANA, CA—The former controller of a company that provides supervision services, including electronic monitoring programs, to courts and probation departments was sentenced today to 37 months in federal prison for embezzling well over $3 million from the company over the course of two years.

Steven A. Hagstrom, 38, of Anaheim, who was an accountant and then controller of the Irvine-based Sentinel Offender Services, LLC, was sentenced this afternoon by United States District Judge David O. Carter.

In addition to the prison term, Judge Carter ordered Hagstrom to pay $2,127,932 in restitution, a figure less than the amount of money embezzled because Sentinel previously was able to recover some of the money.

Hagstrom pleaded guilty last June to one count of embezzlement.

As controller of Sentinel, Hagstrom had access to Sentinel’s bank accounts where fines, court fees and restitution payments from criminal defendants were held in trust. The accounts also held money paid to Sentinel for services provided to state and federal court systems. Beginning in early 2012 and continuing until April 2013, Hagstrom transferred approximately $3,338,197 from Sentinel’s bank accounts to bank accounts he controlled, where they could be used for his own benefit.

“Hagstrom’s theft of such funds jeopardized the proper operation of the criminal justice system,” prosecutors wrote in a sentencing memorandum filed with the court. “Beyond just losing the money, Sentinel might have lost contracts with the government agencies that retained Sentinel due to its failure to safeguard their funds.”

The investigation into Hagstrom was conducted by the Federal Bureau of Investigation and IRS—Criminal Investigation.

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