The small town of Dixon, Ill., had a comptroller who managed to steal at least $53 million from the city, according to FBI agents, who led Rita Crundwell away in handcuffs in April.
The cost comes to nearly $3,376 for every man, woman and child in this town of 15,700 in northwest Illinois. Dixon is probably best known as the boyhood home of President Ronald Reagan.
Crundwell, 58, is internationally known in equestrian circles as the owner of the Meri-J Ranch in Dixon and Beloit, Wis., which breeds and shows champion quarter horses. She also owns farms in several other states. She allegedly used Dixon city funds to run the operations and pay for other aspects of a lavish lifestyle that included ownership of a multi-million dollar luxury motor home and hundreds of thousands of dollars of jewelry, according to the FBI.
FBI agents first accused Crundwell of stealing $30 million over six years, but two weeks later they upped the total to $53 million after going back through more than 20 years of city financial records. The allegations have left many Dixon residents stunned and angry, with some calling for the mayor and city council to resign, though the alleged thefts occurred over multiple political administrations.
Crundwell has pleaded not guilty to wire fraud charges.
Dubious Dollars
Crundwell had total control of city finances. In addition to being comptroller she held the job of city treasurer. So she oversaw money coming in and going out. Tight budgets in recent years have kept streets from being repaired and the city swimming pool from being opened.
That she was able to accrue millions of dollars of assets and own one of the top horse farms in the nation on a salary of $83,000 a year at the time of her arrest probably should have been a tip-off that something was amiss, according to Dixon Mayor James Burke, who told reporters, “”I guess people assumed she was making a ton of money in the horse business.”
Crundwell had been Dixon comptroller since the 1980s but the theft of $53 million allegedly started in 1990.
Agents executed search and seizure warrants at various locations, including Crundwell’s home, office, and horse farms. They also seized the contents of two bank accounts she controlled. Among other items seized were seven trucks and trailers, three pickup trucks, a $2.1 million motor home, and a Ford Thunderbird convertible, all of which were allegedly purchased with illegal proceeds. These and other assets, including more than 300 horses — some of them regarded as among the finest in the nation — will be sold with much of the money being used for restitution, according to officials.
Extended Vacation Downfall
Mayor Burke reported Crundwell to the FBI last fall, after she left for an extended vacation. A city employee who assumed Crundwell’s duties in her absence had asked for all the city’s bank statements and became suspicious about hundreds of thousands of dollars of recent deposits and withdrawals from a certain account. That employee took the records to Mayor Burke who had no idea the account existed, according to the FBI complaint.
Although the bank records show the primary account holder is the City of Dixon, a joint account holder is listed as RSCDA, and the checks written on this account list the account holder as “R.S.C.D.A., C/O Rita Crundwell.”
During the six months the FBI had Crundwell under investigation, she allegedly used more than $3.2 million of city money for her personal and business expenses, “including approximately $450,000 relating to her horse farming operations, $600,000 in online credit card payments, and $67,000 to purchase a 2012 Chevy Silverado pickup truck,” according to the FBI statement.
Suspicious Funds Transfers
Further investigation showed Crundwell had been moving money from multiple city bank accounts into the RSCDA accounts, and many of the transfers appeared to have no legitimate tie to city business.
In a written statement to residents, Mayor Burke said independent audit results “year after year disclosed no instances of non-compliance or other matters required to be reported under government auditing standards. Furthermore, the Illinois Governmental Account Audit Act requires the City to file its
annual audit and other financial documents with the Illinois Comptroller’s Office. The audit review showed no adverse findings or red flags about the City of Dixon Audit. Fifth Third Bank, where many city accounts are held, plus the account that Ms. Crundwell transferred funds into, never reported anything suspicious.”
The mayor explained the apparent decades-long thefts by writing, “We are a tax capped community, which means we cannot raise property taxes to meet expenses. Like Lee County, we have seen a sharp decline in revenues from the landfill. Cash flow problems were complicated because the State has been substantially behind on income tax payments. The City is self insured, and we have experienced a significant increase in health care costs. The City has
also invested in our infrastructure with many projects which have benefited our community. These facts combined led to a plausible reason for the financial problems our community is facing.”
