Question

research the Dixon, Illinois comptroller, I believe her name was Rita. Please describe how she stole from the city, how much she took, how she was caught and how much prison time she received. Additionally, where do you think the auditors failed?

Answer 1

Answer

Rita Crundwell was the former comptroller and treasurer of the city of Dixon, Illinois, from 1983 to 2012. Rita Crundwell was able to embezzle $53.7 million dollars from the city of Dixon through a secret bank account that she opened under the name of city of Dixon. “Crundwell was the only signatory on the account, which was called the RSCDA - Reserve Fund. The initials stood for Reserve Sewer Capital Development Account, and Crundwell was the only person who knew it existed.” Crundwell was eventually sentenced to nearly 20 years after pleading guilty to a single count of wire fraud and admitting to money laundering.

After Crundwell became comfortable in her position she went to the local Fifth third to open a new city account with only her name on it. This should have been a red flag to the Auditor.Once she opened the new account, she started taking smaller amounts at a time. Over time the amount she stole grew exponentially.

During the investigation “invoices submitted by Ms. Crundwell supposedly from the Illinois Department of Transportation lacked an IDOT heading or logo and, in one instance, carried a nonexistent date – Nov. 31, 2004.” . On top of the firm working for the city, they also worked for Crundwell and prepared her tax returns, another red flag.

One of the main reasons Crundwell was able to get away with the fraud for so long was because she controlled more responsibilities than one person should. The lack of separation of duties essentially removed the middle man who might have detected the fraud sooner or made it more difficult. This weakness should have been highlighted by the Auditors., which they did not do.