Swanson suspected that this was not a legitimate city account, and brought the information to Burke, who contacted the Federal Bureau of Investigation (FBI).
In the fall of 2011, while Crundwell was on an extended vacation, city clerk Kathe Swanson, who served as acting comptroller in Crundwell's absence, discovered the account and many checks written on it. For most of her tenure as comptroller, Crundwell had nearly complete control over the city's accounts, while few if any city employees had access to the city financial statements. For small American cities similar to Dixon, lack of sufficient outside audits was a recurring problem, as third-party auditors at best could only give limited attention. However, the city's outside auditors, Clifton Gunderson (now CliftonLarsonAllen after merging with LarsonAllen in 2012) and local accountant Sam Card, dismissed his concerns, as they presumed that Crundwell was honest and signed off on Crundwell's financial statements annually without concern. By the late 2000s, with the financial crisis and economic recession, as city maintenance and equipment suffered, there were some suspicions that she was stealing money, which went as high as Mayor James G. They assumed that either she inherited wealth and/or that her award-winning quarter horse breeding business was profitable in its own right. In the decade prior to Crundwell's arrest, only 65 blocks of road were repaired or replaced.įor most of Crundwell's tenure, residents trusted her despite the city's perilous economic conditions. The city was forced to lay off three of its nine street repair workers and cut the rate of maintenance. The most visible effect, however, was on street maintenance. As a result, employees went two years or more without raises and the police department couldn't get new radios.
She forced city departments to make drastic service cuts in order to keep the budget within reason. Among other things, she bought several cars, a second house and a million-dollar motorhome.Ĭrundwell covered up her embezzlement by claiming the city's frequent budget shortfalls were due to the state being late in paying the city its share of tax revenue. She not only used the money to finance her Quarter Horse operation, but also to support a lifestyle well beyond her $80,000 city salary. In 1991, she stole $181,000, while in 2008 alone she managed to embezzle $5.8 million. On average, Crundwell stole $5 million per year from the city. According to federal investigators, this relatively uncomplicated scheme continued for 22 years. She would have money deposited into another account called the Capital Development Fund, create false state invoices, and then write checks from the fund payable to "Treasurer," which she would deposit into the RSCDA account.
On DecemCrundwell opened a secret bank account named RSCDA (Reserve Sewer Capital Development Account), making it appear to be a city account. She acquired a sterling reputation for instance in 2011 one of the city commissioners praised Crundwell for her stewardship of city finances, saying "she looks after every tax dollar as if it were her own." Embezzlement In 1983 Crundwell was appointed the treasurer/comptroller for Dixon, and she worked in this capacity for almost three decades. Crundwell in 1974, while working as a secretary for Dixon's mayor they divorced in 1986. She began showing quarter horses in 1978. Born Rita Humphrey, the daughter of Ray and Caroline Humphrey, she grew up on her family's farm near Dixon and in 1970, a year before graduating from Dixon High School, began working at the Dixon City Hall as a work-study student.
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