The ringleader of an insider fraud scheme that cost Catholic Charities of the Twin Cities nearly $700,000 has been sentenced to almost six years in federal prison.
The sentencing Monday of Clarissa L. Combs, 49, of Brooklyn Park in U.S. District Court is the last of 12 in connection with the conspiracy that also saw three others locked up for stealing money meant to pay the rent for people escaping homelessness.
While a program manager for Catholic Charities, “Ms. Combs orchestrated a yearslong fraud scheme that diverted hundreds of thousands of dollars from some of the most vulnerable members of society, including individuals and families in need of housing,” U.S. Attorney Erica MacDonald said in a statement Monday.
According to court records and Combs’ guilty plea late last year to charges of wire fraud and making false statements:
For several years during the previous decade, Combs recruited other employees, family and “people she met gambling, and people struggling with financial insecurity and substance abuse issues” to pose as landlords and fictitious homeless clients and receive financial assistance.
Specifically, the employees used their accomplices’ Social Security numbers, fake rental agreements and falsified IRS forms to push through rental reimbursements at Catholic Charities of St. Paul and Minneapolis. The accomplices then split the money with the employees. A statement from the charity as details of the conspiracy surfaced said that “we at Catholic Charities are angered and frustrated to have been the victim of criminal acts [by] individuals who were entrusted with the responsibility of serving our most vulnerable neighbors.”
Catholic Charities is at least the second Twin Cities employer that Combs targeted for financial fraud, according to federal prosecutors. While working in employment and housing areas for the drug treatment Recovery Resource Center, the U.S. Attorney’s Office detailed in a presentence court filing in March, she funneled the center’s money to her mother’s food business.
She was fired for misconduct in 2009 without being charged and hired the next year by Catholic Charities. Also given prison time for their roles in stealing from Catholic Charities were: Aisha R. Bell, 43, of Minneapolis, two years in prison; Tyrone L. Burton, 41, of St. Paul, 1½ years in prison; and Rachael E. Ekholm, 41, of Richfield, six months in prison. Bell also worked for Catholic Charities.
The other defendants avoided imprisonment and received sentences of probation. All 12 were ordered to contribute toward restitution totaling more than $684,000.
The president and CEO of Catholic Charities throughout the time of the fraud scheme was Tim Marx. His resignation was announced in June.
“There is no correlation between the case and Tim’s transition” toward retirement, Catholic Charities spokeswoman Therese Gales said Tuesday.
“Tim had been talking about transitioning out of [Catholic Charities] for quite a while, and he had always thought about being here for about 10 years,” she said.
Marx has been continuing on while the search for a successor continues. Once that selection is made, Marx will move into an emeritus role and assist with the transition in leadership.