ROCKFORD – Longtime Dixon Comptroller Rita A. Crundwell is free on a $4,500 recognizance bond, prohibited from selling any horses or other property while her wire fraud case proceeds in federal court, a judge ruled this afternoon.
Crundwell, who has horse ranches in Dixon and Beloit, Wis., can travel in northern Illinois and to her Wisconsin property, U.S. District Court Judge Michael Mahoney said. She also must surrender her state Firearm Owner's Identification card.
Crundwell, 58, was arrested Tuesday morning at City Hall and charged with a single count of wire fraud. She is accused of defrauding the city by wiring $175,000 in city funds from a bank in St. Paul, Minn. to a bank in Cincinnati for her own use in November.
In an affidavit filed in support of the charge, federal agents say Crundwell misappropriated more than $30 million in city funds since 2006 to finance her own "lavish lifestyle."
Agents raided Crundwell's Dixon home, both horse properties and City Hall on Tuesday, presumably looking for evidence of misdeeds, and confiscated several vehicles, including a $2.1 million motor home.
Crundwell has handled the city's finances since the early 1980s. At a news conference earlier today, Mayor Jim Burke said Crundwell will be placed on administrative leave without pay, pending a vote by the council.
She has a status hearing scheduled for May 7.
ROCKFORD — The Comptroller for the City of Dixon, Ill., was
arrested today by FBI agents on a federal charge for allegedly defrauding the
City of Dixon of more than $3.2 million in public funds since just last fall. In addition, a federal criminal
complaint alleges that the defendant, Rita A. Crundwell, 58, of Dixon, has misappropriated
more than $30 million in city funds since 2006 to finance her own lavish
lifestyle, including operating a horse farm.
Crundwell handles all finances for the city and has held the
appointed position of Dixon comptroller since the early 1980s. She is paid an annual salary of
$80,000, according to the complaint charging her with one count of wire fraud
that was filed last Friday and unsealed today following her arrest.
Also today, agents executed search and seizure warrants at
various locations including, Crundwell’s home, office, and farms in Dixon and
Beloit, Wis., and seized the contents of two bank accounts she controlled. Among other items seized were seven
trucks and trailers, three pickup trucks, a $2.1 million motor home, and a Ford
Thunderbird convertible, all of which were allegedly purchased with illegal
Crundwell is scheduled to appear at 3 p.m. today (Tuesday) before U.S.
Magistrate Judge P. Michael Mahoney in U.S. District Court in Rockford, where
the issue of bond will be addressed. Dixon has a population of approximately 15,733 and is located
in Lee County, about 42 miles southwest of Rockford. The arrest was announced
by Patrick J. Fitzgerald, United States Attorney for the Northern District of
Illinois, and Robert D. Grant, Special Agent-In-Charge of the Chicago Office of
the Federal Bureau of Investigation.
Dixon Mayor James Burke reported Crundwell to law
enforcement authorities last fall after a city employee assumed Crundwell’s
duties during Crundwell’s extended unpaid vacation. After reviewing bank statements for September 2011 through
March 2012, the FBI expanded the investigation and began reviewing the city’s
finances dating back to 2006. The investigation is continuing, officials said.
According to the complaint, Crundwell receives four weeks of
paid vacation annually and she took an additional 12 weeks of unpaid vacation
in 2011. In October last year,
while Crundwell was away from work, a Dixon employee who served as her
replacement requested all of the city’s bank statements. After reviewing them, the employee
brought the records of a particular account to Mayor Burke’s attention. The September 2011 statement for that
account showed three deposits totaling $785,000, as well as 84 checks drawn
totaling $360,493, and 40 withdrawals totaling $266,605. Mayor Burke was unaware that this
account existed, the complaint states, adding that he then went to law
enforcement since none of the withdrawals appeared to be related to any
legitimate business of the City of Dixon. Although the bank records show that the primary account
holder is the City of Dixon, a joint account holder is listed as RSCDA, and the
checks written on this account list the account holder as “R.S.C.D.A., C/O Rita
The City of Dixon maintains numerous bank accounts,
including a Capital Development Fund. Between September 2011 and February 2012,
approximately $2,783,912 in various tax funds were electronically deposited
into one of the City’s accounts. Crundwell
allegedly caused these funds to be moved around to other bank accounts held by
the city, and eventually transferred most of these monies into the Capital
Development Fund account. Between
September 2011 and March 2012, in her capacity as comptroller, Crundwell wrote
19 checks totaling $3,558,000 on the Capital Development Fund account payable
to “Treasurer,” and deposited these checks into the account listing RSCDA as
the joint account holder. She then
allegedly took $3,311,860 from the RSCDA account by checks and online withdrawals,
using only $74,274 for the city’s operations. Crundwell allegedly used the remainder of those funds, more
than $3.2 million, for her own personal and business expenses, including
approximately $450,000 relating to her horse farming operations, $600,000 in
online credit card payments, and $67,000 to purchase a 2012 Chevy Silverado
After discovering that Crundwell allegedly had recently
transferred $3,558,000 in city funds to the RSCDA account, the FBI obtained
additional bank records showing that between July 2006 and March 2012,
Crundwell allegedly deposited a total of $30,236,503 in city funds into the
RSCDA account, and paid out more than $30 million for her own personal and
business expenses. The complaint
alleges that she used fraudulently obtained funds to make additional purchases,
includinga 2009 Liberty Coach Motor Home for $2,108,000, a 2009 Kenworth 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 incurred charges of more than $2.5
million on her personal American Express credit card account, including more
than $339,000 on jewelry alone, and allegedly used Dixon funds to pay the
entire amount of charges.
Wire fraud carries a maximum penalty of 20 years in prison,
and a $250,000 fine, or an alternate fine totaling twice the loss or twice the
gain, whichever is greater. If
convicted, the Court must impose a reasonable sentence under federal statutes
and the advisory United States Sentencing Guidelines.
The government is represented by Assistant U.S. Attorney
Joseph C. Pedersen. The public is
reminded that a criminal complaint is only a charge and is not evidence of
guilt. The defendant is presumed
innocent and is entitled to an indictment by a federal grand jury and a fair
trial at which the government has the burden of proving her guilt beyond a
Here is a perfect example of corruptness in municipal government. The right hand never knows what the left hand is putting into a pocket. In the past decades, many auditors did a "care less" job with the town's books. Perfect proof that the "pay to play" game always wins for the crooked donor. The auditors should be sued for malpractice.
Her bail was most likely $450,000, and she had to only put up 10% or $4500. That's the way it usually works. So if she doesn't show up for court, she must forfit the $450,000. It's interesting to read comments here in a horse related site and the comments on the regular news sites. There, everyone has tried, convicted and sentenced her to death. And they all think it's because she's a Republican. And they think she has money stuffed away in an off shore account. Ha. Horse people seem to see the reality in all this. Of course she purchased some of her horses with stolen money but she did breed some of them. Of course the stallions and mares were the best that could be purchsed with the stolen money. Let the horses keep the awards. Also, I'm sure there are lots of headaches at the AQHA and APHA, so let them off the hook.
I think everyone should slow down a bit........As somebody mentioned, the horses themselves won the titles and, rightly so...have you seen them? I do think that AQHA should take all of her privledges away..forever. I also think they should see about giving some of the "donations" back to Dixon....of course AQHA has no money either...so the rumor goes.
If you have mares that are foaling out, send the paperwork in to AQHA/APHA (etc) without the "signature" this way you will lock in the current fees and although it may be awhile before you get papers, eventually it will get sorted out.
Finally, I sure do believe that way more folks knew what she was doing..had to......hope the Feds get ALL the way to the bottom of this scam.
Unfortunately, there will be no one to sign the stallion reports, which is required for registration and generally done in the Fall.
Having been through this several years ago when a stallion owner I had bred some mares to was going through bankruptcy, it will not be easy for those who have foals on the ground this year, and those currently in utero for next year's crop. In the situation to which I referred, the foal crop that year went unregistered, as did my foals.
Of course this is terrible and wrong. If found guilty, Rita should be severely punished for embezzlement of government funds. Just think about the millions of people that are down on their luck, don't have jobs. How about the poor guy that robs a convenience store for a few bucks, then goes to jail for many years. Where is the proportional punishment for white collar crimes? Rita should be hung out to dry.