Former CFO Pleads Guilty to Embezzling More Than $3 Million from Employer

ST. PAUL, Minn. – An Arizona man has pleaded guilty to wire fraud after embezzling more than $3 million from his employer, announced U.S. Attorney Andrew M. Luger.

According to court documents, David Efrem Katz, 56, was the former Chief Financial Officer (CFO) of Durand and Associates (“D&A”), a property management company that specialized in servicing homeowner associations (“HOAs”).  Between 2012 and 2017, Katz embezzled over $3 million from D&A and its client HOAs. 

Katz worked for D&A from approximately 1998 to 2017, starting as an accountant and eventually becoming CFO. As CFO, Katz had authorization to open credit cards in D&A’s name and use those credit cards for business expenses. However, Katz was not authorized to charge personal expenses to the cards, take out loans on D&A’s behalf without the owner’s approval, or use funds belonging to D&A or its HOA clients to pay his personal expenses.

Beginning in at least 2012 and continuing into 2017, Katz embezzled over $3 million from D&A and its HOA clients. Katz, who as CFO of D&A was responsible for payroll, paid himself significantly more than his agreed upon salary. Between 2011 and 2017, Katz paid himself $6,500 every two weeks as a salary despite his base salary never being more than $47,500 annually.

Katz also reimbursed himself for personal expenses and business expenses he never actually incurred. Katz paid himself between approximately $6,000 and $10,000 in reimbursements every two weeks. He labeled these payments as miscellaneous earnings and reimbursements, “recovery loans,” bonuses, and commissions. Katz never loaned or invested money in D&A that he was entitled to “recover.” To the extent he earned bonuses and commissions, they were in amounts significantly less than what he paid himself. And although Katz incurred some legitimate business-related expenses, they were in amounts significantly less than what he reimbursed himself.

Katz pleaded guilty on June 26, 2023, in U.S. District Court before Judge Katherine M Menendez to one count of wire fraud. A sentencing hearing will be scheduled at a later time.

This case is the result of an investigation conducted by the FBI.

Assistant U.S. Attorneys Harry M. Jacobs and Matthew S. Ebert are prosecuting the case.