A retired nun who was the longtime principal of a Catholic elementary school in the Los Angeles area could face up to a maximum of 40 years in federal prison for allegedly embezzling approximately $835,000 to finance gambling excursions to Las Vegas and Lake Tahoe.
In accordance with an apparent plea bargain, the nun has pleaded guilty to one count of wire fraud and one count of money laundering.
Despite a vow of poverty, Mary Magaret Kreuper, 79, “embezzled money from St. James Catholic School,” in Torrance, Cal., for about 10 years up until she retired in 2018.
According to prosecutors in the U.S. Attorney’s Officer for the Central District of California, Sister Kreuper diverted funds into two accounts: The St. James Convent Account and the St. James Savings Account.
In what might possibly give an alternative meaning to the term habit, she used the money from those accounts for “large gambling expenses incurred at casinos and certain credit card charges,” federal prosecutors explained.
In her position, Kreuper controlled the school’s finances, including monies that came in for student tuition, charitable donations, and to pay nuns’ living expenses.
The nun, who served as the school’s principal for about 30 years, also allegedly engaged in some creative bookkeeping in preparing monthly and annual reports so that no one in the school administration would notice what was going on.
The school administration and the Archdiocese of Los Angeles apparently figured out that something was off-kilter while conducting a financial review around the time of the principal’s retirement. They then contacted authorities. The local police as well as the FBI and the IRS handled the investigation.
Kreuper’s attorney said in a statement said that his client is “very remorseful for what happened,” adding that “Unfortunately, later in her life she has been suffering from a mental illness that clouded her judgment and caused her to do something that she otherwise would not have done,” the Los Angeles Times reported.
She became a nun at age 18 and “has dedicated to life to helping others,” the lawyer underscored.
“The community of faith at St. James was shocked and saddened by these actions and the parish, school and the archdiocese reported the matter and fully cooperated with authorities in the criminal investigation,” the Archdiocese asserted in a statement. The St. James Catholic School has yet to issue a public statement in response to the U.S. Attorney’s announcement.
Another nun was reportedly also in on the scheme. It’s unclear if there will be any further prosecutions.
Kreuper is due in federal court on July 1. Given that she agreed to a plea deal, plus other factors such as age, it seems highly unlikely that a judge will impose anything close to the maximum penalty.
The nun also reportedly agreed to pay restitution, which means she plans to reimburse the school for its loss. That’s a big-ticket item obviously, so it remains to be seen how this will play out.
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Robert Jonathan is a staff writer for BizPac Review. He is a longtime writer/editor for news aggregation websites and has also developed content in the legal and financial publishing sectors as well as for online education. He earned a Juris Doctorate from the University of Connecticut School of Law, “a law school the basketball teams can be proud of.”
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