Bookkeeper stole $1M from SC business: feds

Karen Rhett was the bookkeeper at a South Carolina real estate company for the better part of 25 many years, according to federal court docket files.

She was also embezzling from it, prosecutors mentioned.

A federal choose sentenced the 59-yr-outdated to 3 decades in prison on Monday, April 4, after she pleaded responsible to felony costs previous yr. She was also purchased to devote a few years on supervised release and spend restitution.

Rhett’s defense legal professional did not straight away answer to McClatchy News’ ask for for comment on April 6. But he stated in court filings that she took whole obligation for the theft soon after the FBI confirmed up at her residence in Mount Pleasant, just outside the house of Charleston, in 2020.

“Painfully, and with deep sorrow, she admits that she took edge of her placement of believe in as a bookkeeper,” mentioned George Rutledge DuRant, who represented Rhett. “She admits that her theft was enduring and began long back with a rather modest amount of money of revenue. It escalated with time. The additional she stole, the harder it grew to become to quit.”

In accordance to court docket paperwork, Rhett labored for Simmons Realty Firm, a authentic estate company run by David and Elizabeth Simmons.

“It took 3 prolonged yrs of tedious investigative function by the household and a forensic accountant (former IRS Exclusive Agent) to uncover this complex and sophisticated fraudulent scheme,” Bart Daniel, who represented the Simmons, instructed McClatchy Information in a assertion. “The Simmons Loved ones is relieved that justice has finally been served.”

Prosecutors stated Rhett oversaw the company’s accounting and business enterprise information and was “in a placement of trust” when she allegedly began siphoning off funds.

She is accused of transferring cash to herself, typically transferring the cash amongst other business entities ahead of it ultimately landed in her account. Rhett also created up small business invoices for bogus expenditures and wrote checks to herself right before recording the payments as genuine, the federal government claimed.

The Simmons inevitably fired her, and FBI brokers frequented Rhett at property in July 2020, court paperwork state.

In accordance to her legal professional, Rhett confessed to the embezzlement the subsequent thirty day period and commenced cooperating with federal investigators.

“It ought to be recognized that Karen made the selection to confess completely on her possess and speedily, inside of 1 week of the F.B.I. knocking upon the door of her home,” her legal professional mentioned.

Rhett sold the 4,000-square-foot house she shared with her husband and daughter for $982,000 in December 2020, in accordance to serious estate listings. Her attorney explained she wrote a test for restitution totaling $640,633 and submitted it to the court in January 2021.

Rhett was billed by felony data and pleaded responsible to prices of wire fraud and making wrong statements, court docket documents clearly show. Her legal professional mentioned she was fired from her new job at a holistic nutrition store when information of the guilty plea broke in April 2021.

Rhett subsequently started out a company, Cupcake Bouquets by Karen, by which she bakes and sells “delicious and inventive, primarily floral in design and style, cupcakes,” her law firm explained.

From August 2021 to February 2022, he claimed, she has sold $3,648 value of cupcakes.

“Karen is convinced that Cupcake Bouquets by Karen, LLC would find the money for her the usually means by which she can make meaningful payments towards entire restitution,” her attorney mentioned in sentencing paperwork. “In conditions of using on new orders and developing this organization as it stands now, Karen has been careful not to choose on as well quite a few new orders or to mature way too rapidly as her imminent long run is, at greatest, uncertain.”

Rhett’s attorney had requested the judge to sentence her to a interval of house confinement, pointing in portion to her struggles with melancholy considering that the prices came to light and a modern diagnosis of Fibromyalgia.

He also said it is critical for Rhett to be property with her 21-calendar year-old daughter, who has reportedly struggled with her own psychological wellness just after a shorter-lived vocation as a singer-songwriter. In accordance to sentencing documents, her daughter earlier sang at “various east coastline faculty gymnasiums and functionality halls with a concept against bullying” as a teenager.

Rhett submitted six letters of support penned by her therapist and several spouse and children associates also contacting for leniency.

“Karen has suffered the effects of a self-imposed sentence, shame and guilt right before her friends and household and the entire local community,” her lawyer reported. “She has endured the decline of nearly her each and every possession and she has endured the continuous agony of darkish melancholy. She has been punished severely by now.”

At sentencing, the choose advised Rhett provide her jail sentence at FPC Alderson in West Virginia so that she can obtain health care treatment. After she is released, the decide barred her from obtaining any call with the victims.

The sum of restitution she owes is listed as “TBD” in the courtroom docket.

This tale was at first published April 6, 2022 3:33 PM.

Hayley Fowler is a reporter at The Charlotte Observer covering breaking and genuine-time information across North and South Carolina. She has a journalism diploma from the University of North Carolina at Chapel Hill and earlier worked as a legal reporter in New York City just before joining the Observer in 2019.