Prosecutions up for white-collar crimes

  • Article by: JOY POWELL , Star Tribune
  • Updated: March 29, 2011 - 3:12 PM

Officials in Dakota County report a rise in prosecutions of financial criminals.

A judge's order last week that a former Eagan woman, Katharine L. Rosenthal, pay more than $456,000 to an autistic man whom she had defrauded involved one of the biggest financial crimes ever prosecuted in Dakota County.

It is also among a rising number of charges involving white-collar crime in the county and state, authorities say.

County Attorney James Backstrom said his office saw an uptick in prosecutions of cases of white-collar and financial crimes last year. They involved embezzlement, theft of money from a company or organization, and tax fraud.

"These crimes are very complex and involve the need to gather bank receipts and other extensive financial records to establish a paperwork trail of fraud," Backstrom said.

An Afton woman, for example, faces a hearing in August over restitution that could reach $602,700. The Dakota County Attorney's Office called the case its biggest-ever theft prosecution. Cindy Lou Sears, 52, formerly Cindy Kutscher, was convicted of embezzling from Navy Island Plywood in West St. Paul, where she was a bookkeeper.

And there's also the case of Kuntee Singramdoo, 50, of Lakeville who was sentenced in January to 39 months in prison for embezzling while an independent closer for a Burnsville title and real estate firm. She owes $516,479 in restitution.

In Dakota County last year, six people were charged with theft, theft by swindle or theft by false representation involving a business, school or youth organization. Another four people were charged with 21 counts of tax-related crimes.

"Some of that, to some degree, could be a sign of the times," said Dakota County Sheriff Dave Bellows."We're talking about hard economic times, so people try to take advantage of these kinds of thefts. I'm not surprised to see that there is an elevation in those types of crime."

But Backstrom said the uptick in prosecutions does not necessarily mean that more cases are being reported -- just that his office has been filing more charges for embezzlement and swindles. That's in part because state agencies are beefing up their investigative assistance, he said.

Backstrom said such prosecutions require considerable time on the part of the police or sheriff's agency or the Minnesota departments of Commerce and Revenue.

"We've become more aggressive in investigating these crimes, particularly by referring more of our cases to criminal prosecutors like the Dakota County attorney's office," said Nicole Garrison-Sprenger, spokeswoman for the state Department of Commerce.

"In 2010, we referred more than 70 cases [statewide]. That's up from about 45 in 2009 and way up from the two or three a year a few years ago," she said.

At the state Revenue Department, two new investigators have been added to a 12-person division. Thomas Teale, director of that division, said his agency aggressively pursues state tax violators, recovering more than $6 million from tax evaders in the past three years.

"We regularly assist county attorneys in the prosecution of complex fraud cases," Teale said. "Sometimes the fraud is so complex that it's difficult to prove. But it's not hard to prove that the defendant received income as a result of the fraud."

That's why some swindlers have been prosecuted for tax violations, officials said -- because it's easier to prove and get a conviction, and sometimes, perhaps the only way.

Teale said his agency's caseload has more than doubled since 2005, to 732 cases last year.

Sheriff Bellows noted how time-consuming such cases can be for investigators.

A modern-day cattle rustling case, for example, was so complex that investigators from the Sheriff's Office and South St. Paul police called in state investigators to help prove criminal elements of the case, much of which was on paper, with fictitious cattle being moved by an employee of a farmers' cooperative.

For swindling her autistic neighbor, Rosenthal, 41, will spend time behind bars in addition to having to make restitution. She was sentenced last week to a year in jail and 20 years' probation, with a 33-month prison term stayed.

Joy Powell • 952-882-9017

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