JPS Embezzlement
It all started back in September 2018. Adam and I were out of town and we got a call from Curt. He said that he had just opened some mail that usually goes to Richard, but he was out of town. (We learned later that Richard was careful to cover his tracks and told Andrea before leaving on vacation, which was supposedly a business trip for another job, to just put all the mail under his door and don’t let Curt open it because it will mess up his system) It was a darn good thing Curt decided to check the mail that day and open the bill because it started a roller coaster of discovery’s! The bill he opened was a statement much higher ($25000) than what Curt thought it should be, so he called the bank and found all his passwords had been changed. Red flags but nothing too surprising. Richard has done something similar before where he borrowed against a bill to cover payroll and then paid it back. We assumed this was what he did again. Which he was written up for the first time, so he knew not to do it again. The next day when Richard returned (returning early) Curt asked him about it and he just hoed and hummed about it. Curt spent the weekend digging through more bills and statements and kept finding things that did not add up or reflect the statements he received from Richard. He continued to call Adam multiple times a day with new findings. As things started to unravel and more and more was found, Curt texted Richard and told him not to come in on Monday that they had found more discrepancies. At this point we assumed Richard was thinking we had only uncovered a small portion of this mountain he had created and was not too worried. But as more and more findings came to pass it became clear that he had buried us far more than we could have imagined and far more than we thought he could or would. He had been with JPS for 5 years. Although a little weird he was so nice. Always asking about our families, bringing in breakfast sandwiches for the crew (that we now believe JPS was probably paying for) Over the next couple of months over $400,000 was found. He had payroll accounts set up with random names claiming they were employees, he had credit cards maxed, had opened new credit card accounts, was paying for his credit cards with JPS money, had receipts in his desk for diamond earrings and Rolex watches, was behind on every bill we pay, had used credit at pool supplies stores over and over again, had overpaid himself weekly, had gas cards for himself in Ronda’s name and an article on his computer titled “how to change your identity and disappear.” This was no accident and no joke. It was deliberate. He knew what he was doing and had it gone on for much longer he would have buried us too far to come back from. A multimillion-dollar company out of business. As more and more continued to be unburied we continued to be more and more shocked. Our accountant could not believe how he was able to do it. He had never seen anything like it. He was giving Curt, Adam, and Sean bogus reports every month to reflect where the accounts were supposed to be, as he was behind the scenes taking more and more money. Even as we were investigating, he continued to move money around, he continued to use his gas card and tried to withdraw money from an account. We tried a few times to get police and fraud protection services involved but they kept saying we had to uncover as much as possible to have enough evidence to prosecute. After talking to the lawyer who was currently working on 3 other embezzlement cases recommended that we try and work out a deal where he could avoid jail time if we could all come up with an agreement as to the amount, he would need to pay back. The letter was written up and he was served the papers. His wife answered the door, said he was home but would not bother him. She accepted the papers on his behalf. We were glad to hear he was still in town. As time went on, we worried he would high tail it out of town or the country. We know he has connections in New York and Mexico. To our surprise his lawyer reached out to our lawyer, but no agreements were made. They were to meet a few days later but never heard from him again. On Facebook one of Richards daughters put in her status that they were moving to North Carolina while the other daughter put Washington. Sure, enough a couple days later there were moving trucks in front of his house. We went and took pictures of the trucks and license plate numbers. At this point our lawyer got impatient with the feds and met with them and discussed the laws and got the ball rolling. We had detectives show up the next day ready to help. That night the moving trucks pulled out and were gone. We decided that we had given him a fair chance. He did not take it and skipped town, so at this point we will prosecute. We have got people looking for him and tracking him. Throughout the process Adam and I have talked about how we feel putting him in jail. It is not something either of us want to do but with everything that has happened we feel it is what needs to happen. We figured he has probably done this before to some other company and we felt we needed to make sure it did not happen again. He was finally tracked down living in South Carolina with his wife and kids. The detective knocked on his door but there was no answer. The next day his lawyer contacted us again. His lawyer told him the best thing to do was turn himself in and to get to Utah as soon as possible to meet with him. Richard did and our lawyers discussed the situation. He said Richard said he was guilty and had a trust with $30,000 in it he could turn over to us without any other consequences. Our lawyer instructed us to not take the deal. Richard returned to South Carolina (Something we were surprised with, since he essentially turned himself in) over the next months and months he would continue to work the system and finagle his way out of every situation. We were stunned but figured he had done this before…he knew exactly the steps to take to stay out of jail. The case became quiet for a time until we had the FBI call Curt. (At this point about a year had passed.) Because of the amount of embezzlement, the case was turned over to the FBI. They intended to not stop until this case was closed. There had been a rash of embezzlement in St. George lately and they wanted to get to the bottom of them and make a lot of noise along the way as a warning to future embezzlers. Not long after an article came out in the St George news about the story. No suspects or victims were named, just the case. The FBI continued to keep us updated and the ball seemed to be rolling and then…COVID-19 hit. Things slowed down and Communication slowly continued between our lawyers. In September 2020, two year after the initial finding, Richard had his first hearing via zoom. Curt, Adam, and Sean watched. Very little was said, except that he pled guilty and they set a date for his sentencing. He continued to work the system, claiming he could only do an in person sentencing, knowing that the courts were only doing virtual sentencing. His court date was postponed. More waiting…At this point he could have served his time already instead of buying more time. Finally, December 2nd, 2020 he agreed to a virtual sentencing. Curt, Ronda, Adam, I, Sean and Amy were all in attendance. The victims were given an opportunity to speak. Curt had already sent in a letter to the judge and had nothing more to say. Adam had nothing he wanted to say but Sean had a few things to get off his chest. After the victims spoke and lawyers spoke it was Richards' turn. I appreciated that he wanted to address Curt, Adam, and Sean. They were not impressed, claiming if he is talking, he is lying. He expressed his remorse and apologized for his actions, then spoke to each of them separately. He told Adam that he looked up to him and that he was an example to him. He told the court that Adam was always the first to work and last to leave (not a lie) and said he was sorry to betray him and their friendship. After they all had a chance to talk, the judge sentenced Richard to prison in Alabama to be close to his family for 24 months. Richard asked if he could be recommended to attend a self-help program while serving time. The judge obliged. He also told Richard he and just like that it was over. Two years in the making was over in 30 minutes. It really is still bittersweet. He was a friend and he betrayed us. He is going to jail, and we put him there. It is a lot to take in but if it will help other companies not have to go through what we went through then it will be worth it. So thankful that we were able to get through it and that finances have balanced back out. We ended up having one of our best years in 2020. Crazy what a business can do when it's not being stolen from. :)
ST. GEORGE — A 45-year-old accountant is facing felony charges after allegedly embezzling more than $400,000 from a St. George business over the course of several years.
Richard William McDonald, who now lives in Greer, South Carolina, has been charged with six second-degree felony charges, including one count of unlawful dealing with property by a fiduciary and five counts of theft, as well as one third-degree felony count of unlawful acquisition of a finance card without consent.
On Sept. 20, 2018, the owner of a pool supply business in St. George reported to police that McDonald, a former employee of the store, had embezzled more than $400,000, according to the affidavit filed in support of the charges. McDonald was the company’s accountant for more than four years and was responsible for making all payroll and business expense payments.
According to an affidavit, the alleged theft was discovered by the owner after he was notified that several of the company’s credit line accounts were past due, which took him by surprise, since the ledgers maintained by McDonald showed a zero balance for the accounts.
The owner hired an outside accounting firm to go over the company’s financial records, and it was discovered that McDonald allegedly paid himself more than what was authorized by the company and had transferred funds from the business accounts to personal bank accounts on a number of occasions.
Since McDonald had access to the company’s finance accounts and was responsible for making payroll transfers from the business account into the employees’ personal bank accounts, police say he was able to disguise the payroll transfers by linking the payment to a second bank account opened by the defendant to deposit the unauthorized payments.
The accounting firm determined that McDonald overpaid himself by more than $78,400 in 2017 and more than $53,000 in 2018. Additionally, the affidavit alleges that McDonald used the business’ bank accounts to make payments on his personal credit accounts to the tune of more than $303,000 over a two-year period. He also allegedly made $7,300 in unauthorized fuel purchases on the company gas credit card since 2016 and continued to purchase fuel with the card even after his employment was terminated by the company.
“Due to Richard’s unique position of trust in the company and his direct access to the company’s finances, he was able to directly steal from the company in excess of $400,000” the detective overseeing the case noted in the affidavit.
The business owner told police that McDonald used manipulated financial and payroll statements to hide the theft and present a financial picture of the business that was inaccurate and misleading.
According to authorities, immediately after he was terminated from the company, McDonald fled the area and moved his family out of state to avoid being arrested.
McDonald’s case is currently progressing through the courts, and he has yet to enter a plea.
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