Woman Accused of Embezzling Nearly $250,000 from Local Modular Home Manufacturer
PAINT TWP., Pa. (EYT) — A former employee of a Paint Township modular home manufacturer is facing theft and fraud charges in an alleged scheme that embezzled nearly $250,000.00 from the company.
According to court documents, on Friday, May 26, Clarion-based State Police filed criminal charges against 62-year-old Carole Lynn McConnell, of Butler, in Magisterial District Judge Timothy P. Schill’s office.
The charges stem from incidents that occurred between approximately May 21, 2019, and June 21, 2021, at a modular homes factory located on Paint Blvd., Paint Township, Clarion County.
According to a criminal complaint, the general manager of the Paint Township modular home manufacturer contacted PSP Clarion on July 7, 2021, to speak to an investigator regarding a theft involving the company’s controller, Carole Lynn McConnell. The general manager (GM) reported during McConnell’s employment, up until her termination, that she had used her position at the factory to steal a large sum of company money to use for personal gain/interest.
The GM found that McConnell was using the company’s business credit cards to make purchases at multiple stores and online websites, where she acquired several thousands of dollars in gift cards, services, and merchandise for personal gain, the complaint states.
On July 8, 2021, a PSP Clarion Trooper responded to the factory and met with the company’s GM, Chief Financial Officer (CFO), and a third employee. During their meeting, it was related that McConnell was hired by the business in February 2017 as the plant controller. Her direct supervisor was the GM.
The GM stated that on June 16, 2021, an employee came to him with concerns they had regarding McConnell’s expense reports. The employee was uncomfortable submitting her reports without the GM’s approval. It was brought to the GM’s attention that McConnell was not properly submitting receipts or “proof of purchases” for her expenses, according to the complaint.
The GM stated that upon reviewing McConnell’s request for payments for the company’s Walmart account, they did not contain any statements. They only contained handwritten explanations made by McConnell. The GM stated that after pulling McConnell’s reimbursement file, he discovered very few receipts for purchases. Submissions that had a receipt often did not include the method of payment because it was cut off. He found significant purchases of VISA gift cards that stated they were given to dealer companies they worked with, but they appeared suspicious, the complaint indicates.
After making copies of what was suspected of being unapproved purchases, the GM contacted the CFO and advised him of his concerns, the complaint notes.
The GM stated that on June 17, 2021, he confronted McConnell about the suspicious charges on the company credit card and asked for appropriate documentation that day. He discussed his concerns and informed McConnell her actions were a violation of company policy. He learned that after he had confronted McConnell, she called the CFO and provided him with an explanation that did not make sense and sounded suspicious. The CFO permitted McConnell until Monday, June 21, 2021, to provide the GM with the appropriate documentation, the complaint states.
On June 21, 2021, McConnell did not report for work. She was terminated on June 30, 2021, the complaint indicates.
On June 23, 2021, the GM and staff attempted to log in and check their Walmart credit card account transactions. While attempting to log into the account, the credit cards were not recognized, and the staff was unable to gain access to the account. The GM related to the trooper that they had to get the Walmart account password by going into McConnell’s work computer where it was discovered McConnell’s name was the only authorized name listed on the card, the complaint states.
The GM indicated when they accessed McConnell’s work computer, they discovered the passwords were the same for the Walmart business card account and the Amazon account. Once into the Walmart account, five previously unknown Walmart corporate credit cards were discovered to have been opened and issued under the company’s name with McConnell listed as the only authorized user, the complaint continues.
Additionally, the GM provided the trooper with a copy of a bill from a gas company. The bill was dated July 7, 2021, and was linked to a customer account belonging to McConnell’s daughter, according to the complaint.
The GM indicated that unapproved purchases were linked to McConnell spanning between May 21, 2019. to June 11, 2021, totaling upwards of $216,706.95, the complaint indicates.
The GM also reported they discovered some records of McConnell’s were missing and believed she removed or destroyed them in an attempt to hide evidence. He indicated the company’s bank account statements were missing, as well as the credit card files in accounts payable. McConnell had access to both, the complaint notes.
According to the complaint, during the meeting, the CFO indicated that on June 29, 2021, McConnell called him, and during their conversation, he confronted McConnell about her company credit card use and gift card purchases. McConnell told him that she was using the gift cards to purchase “oxy pills” off the street. McConnell begged him not to report her and offered to pay everything back. McConnell also admitted to having a past embezzlement conviction and admitted she had been stealing from the company for about one to one-and-a-half years.
On July 9, 2021, the trooper reviewed account statements and transaction records provided by the company. Between April 8, 2020, and June 12, 2021, McConnell made unapproved purchases from various Walmart and Sam’s Club locations in the surrounding areas, the complaint indicates.
Between May 21, 2019, and June 8, 2021, unapproved spending by McConnell was found in the company’s bank account. This included unapproved purchases from Amazon.com, grocery stores, various department stores, and restaurants, the complaint continues.
Between December 31, 2020, and March 24, 2021, fraudulent activity was found via the company’s expense reports and miscellaneous invoices, totaling $216,706.95, according to the complaint.
Multiple online Amazon purchases, totaling $13,745.82, were placed for a variety of merchandise. McConnell was found to have used her address in New Castle, Pa., as the shipping address. Multiple purchases were determined to be toddler/child items, games, dishes, collectibles, coffee, personal hygiene products, women’s footwear, clothing, electronics, and tools, the complaint indicates.
During this investigation, the trooper submitted requests to the Clarion and New Castle Walmart, and Sam’s Club locations in Butler, Pa., and Boardman, Ohio. Information was provided to assist in searching their surveillance and receipt records for the suspected fraudulent purchasing done within their store locations, the complaint indicates.
On July 26, 2021, Clarion Walmart provided records that they were able to find on their system. They provided multiple receipts and video footage detailing McConnell inside the store, using multiple cards, all linked to the company’s corporate account. A review of the receipts and images show McConnell making unapproved personal purchases of merchandise and using the business card to activate prepaid cards in various large amounts, the complaint notes.
On August 4, 2021, correspondence was received from the Butler, Pa. Sam’s Club Merchandise Compliance Officer. They provided six receipts for transactions, going back to April 2020, linked to the various corporate cards McConnell was using. Two corporate credit cards were linked to a Sam’s Club Member’s account. The membership ID number on the receipts came back to McConnell, the complaint states.
A review of the receipts show McConnell made unapproved personal purchases of merchandise and McConnell used the business card to activate prepaid cards in various large amounts, the complaint states.
On August 5, 2021, receipts and video footage from the New Castle Walmart were provided, including a total of 19 receipts, multiple images, and 11 CDs containing video footage of McConnell making purchases. The purchases ranged between January 24, 2021, and June 12, 2021. The receipts corresponded to purchases made using the company’s corporate credit cards and accounts, the complaint states.
A review of the receipts and images show McConnell making unapproved personal purchases of merchandise and McConnell using the business card to activate prepaid cards in various large amounts, the complaint continues.
On August 9, 2021, correspondence from the Member/Specialty Manager from the Sam’s Club in Boardman, Ohio, was received. They located 15 receipts and images linked to purchases and attempted purchases by McConnell using the company’s corporate credit cards and accounts, according to the complaint.
A review of the receipts show McConnell made unapproved personal purchases of merchandise and activated prepaid gift cards, the complaint indicates.
On September 28, 2021, the trooper responded to the company and met with the GM about additional fraudulent activities discovered involving company checks forged by McConnell, according to the complaint.
The GM related that on September 17, 2021, employees discovered odd transactions in accounts previously managed by McConnell. He reported copies of checks were discovered written out of accounts not typically used by the company. Additionally, checks were issued to employees with McConnell’s name being the only approving signature. No backup documentation was on file supporting the issuance of each check or explaining the reason for each payment. Checks that contained a reason were suspicious in nature. All questionable checks were brought to the corporate business’ attention, the complaint states.
Upon an internal investigation, it was found that the checks were fraudulent, the complaint notes.
The GM stated that 30 fraudulent checks issued between May 8, 2019, and June 10, 2021, were discovered for various amounts made out to company employees. Of the discovered checks, 27 were not approved by the company, and associated request forms on file were endorsed by McConnell’s signature only, the complaint states.
The fraudulent checks totaled $30,100.00, according to the complaint.
The GM found three fraudulent checks had his name as the receiver of the payment. He stated McConnell forged his signature on the back of each check for an endorsement, the complaint states.
Four company checks were forged by McConnell and made payable to herself between November 26, 2019, and January 5, 2021, which indicates the complaint.
A new total of $246,689.15 was provided to the trooper by the GM, the complaint notes.
According to the complaint, on January 31, 2022, correspondence was provided to the trooper from the company’s insurance carrier, indicating that they had paid the company’s claim for the covered loss of $242,587.98.
Between February 8, 2023, and April 23, 2023, the trooper conducted interviews with 13 separate employees or former employees of the company who were listed on the fraudulent checks as the receiver of the payment. It was found that all checks endorsed by McConnell were forged and fraudulent and that they were not received by those named on the check, the complaint states.
According to court records, McConnell was arraigned at 11:55 a.m. on Friday, May 26, on the following charges in front of Judge Schill:
- Theft by Failure to Make Required Disposition of Funds Received, Felony 2
- Theft by Unlawful Taking or Disposition – Immovable Property, Felony 2
- Forgery – Unauthorized Act in Writing, Felony 2 (31 counts)
- Access Device Fraud – Other Reason Access Device is Unauthorized by Issuer, Felony 3
- Access Device Fraud – Publishes, Makes, Sells, Gives, or Otherwise Transfers to Another, Felony 3 (five counts)
- Tampering with or Fabricating Physical Evidence, Misdemeanor 2
Unable to post $200,000.00 monetary bail, McConnell was lodged in the Clarion County Jail.
A preliminary hearing is set for June 6, at 1:15 p.m. with Judge Schill presiding.
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