A 59-year-old southern Minnesota woman has been sentenced to more than two years in prison for stealing more than $500,000 from a close friend and onetime employer to feed her online gambling addiction.

Theresa E. Linsmeier, of Fairfax, was sentenced Tuesday in federal court in St. Paul after pleading guilty in June to wire fraud and filing a false tax return. After her 2¼ years of incarceration, she will spend three years on supervised release and must make full restitution for the money she stole.

Linsmeier was the bookkeeper for the family owned Farm Mercantile hardware store from 1998 to 2016 and had authority to sign and issue checks for the store and for its owner, Kelly Albrecht.

“Linsmeier abused the trust of her friend and employer,” read a presentencing court filing by prosecutors. “She stole not only from the business account but also from Kelly Albrecht’s personal bank account. She used the money to pay her credit card bills and to gamble online.” 

The embezzlement scheme “had a devastating impact” on the store and its owner, the filing continued. “The company struggled for years due to Linsmeier’s theft, so much so that Albrecht stopped receiving a salary and worked seven days a week to try and get this back on track.”

Linsmeier transferred money from the business and Albrecht’s personal account and used more than $540,000 to gamble online from 2011 to 2016. She allegedly created false entries in the store ledger to make it look like the money was used for legitimate business purposes.

Because she failed to report the money she embezzled on her tax returns, she avoided nearly $115,000 in federal income taxes from 2012 through 2016.