How Comptroller of Small Illinois City Stole $30 Million Over 6 Years

April 18, 2012 — -- The comptroller of a small city in Illinois is accused of misappropriating more than $30 million in city funds and using the money to support a "lavish lifestyle," including a large farm with over 150 horses, over $339,000 in jewelry, and numerous vehicles.

Rita Crundwell, 58, of Dixon, Ill. was arrested on Tuesday by the FBI on a federal charge for stealing more than $3.2 million in public funds since last fall. Authorities, however, believe she had been helping herself to the public funds since 2006.

FBI agents used seizure warrants at Crundwell's home, office, and her champion horse farm in Beloit, Wisc. as well as another farm in Dixon, and seized contents of two bank accounts she controlled.

As the town's comptroller since the early 1980s, Crundwell earned an annual salary of $80,000, according to the complaint filed on Friday in the Northern District Court of Illinois.

Her attorney, Kirstin Carpenter of the Federal Defender Program, said Crundwell declined to comment.

Dixon has a population of 16,000, according to its website, and a budget of $8 million to $9 million a year, the Chicago Tribune reported. Crundwell who handled all finances for the city, allegedly had access to an account that was unknown to Dixon's Mayor James Burke.

The mayor did not immediately return a request for comment.

Crundwell is accused of moving funds from the city's various bank accounts through a series of wire transfers and checks payable to "Treasurer," and depositing them into the unknown account from which she withdrew money for her own personal and business expenses.

The unknown account was held by the City of Dixon, but an entity called "RSCDA," was also listed. Checks written from this account were in 'C/O Rita Crundwell,'" the U.S. Attorney's office said.

Using her allegedly ill-gotten funds, Crundwell paid $450,000 in expenses related to her horse farming operations, including $200,000 of expenses for feeding, insuring and providing veterinary care for her horses; $600,000 in online credit card payments for unspecified purchases; and $67,000 to purchase a 2012 Chevy Silverado pickup truck last November, the U.S. Attorney General's office in Illinois said.

Crundwell received four weeks of paid vacation annually and she took an additional 12 weeks of unpaid vacation in 2011, according to the complaint.

While she was away in October, her replacement reviewed the city's bank statements and discovered the unknown account Crundwell, and informed the mayor.

Crundwell is in federal custody in Illinois, and will appeal today at a bond hearing in Federal Court in Rockford, Ill., the U.S. Attorney's office said.

One of the best horse breeders in the world, Crundwell's Meri-J Ranch in Beloit, Wis. produced more than 50 world champions, according to the American Quarter Horse Association, the Chicago Tribune reported. The ranch stables about 150 horses, the court complaint states.

Crundwell is also accused of fraudulently obtaining city funds to make other purchases, including a 2009 Liberty Coach Motor Home for $2.1 million, a 2009 Kentworth T800 Tractor Truck for $146,787, a 2009 Freightliner Truck for $140,000, a 2009 Chevrolet Silverado pickup truck for $56,646, and a 2009 Featherlite Horse Trailer for $258,698.

Between January of 2007 and March of 2012, Crundwell allegedly used city funds to spend more than $2.5 million on her personal American Express credit card account, including more than $339,000 on jewelry, spending an average of over $5,380 a month.