Thursday, July 25, 2024

Hutchinson Woman Sentenced to Prison for Embezzling More Than $2 Million from Employer - Background Check Minneapolis

 MINNEAPOLIS – Jennifer Lee Rath, 53, of Hutchinson, Minnesota, has been sentenced to 41 months in prison, followed by three years of supervised release, and ordered to pay full restitution for embezzlement of over $2 million from her employer, announced U.S. Attorney Andrew M. Luger.

According to court documents, Rath worked as the financial controller at a heavy civil construction company in Hutchinson. In her role, she was responsible for managing the company’s payroll, accounts receivable, accounts payable, company credit cards, and corporate bank accounts. Over a six-year period, Rath exploited her position to embezzle funds for her personal use. She routinely cut checks that appeared to cover company liabilities but manipulated them to pay her own credit card debts, tax liabilities, and other personal expenses. Rath also processed electronic fund transfers from the company’s bank accounts to cover personal expenses and charged personal expenses to company credit cards. To conceal her theft, she manipulated the company’s accounting software, avoiding detection and prolonging her fraud scheme.

Between August 2013 and December 2019, Rath embezzled a total of $2,061,328.67 from her employer. Her actions severely impacted the company, leading to job losses, delayed payments to vendors, and damage to the company's credit and reputation.

On September 7, 2023, Rath pleaded guilty to one count of mail fraud. She was sentenced on June 18, 2024, by U.S. District Judge Jerry W. Blackwell, who expressed particular concern that Rath exploited a longtime family friend who had entrusted her with a position of financial responsibility over a small business.

This case resulted from an investigation conducted by the FBI and the Hutchinson Police Department. Assistant U.S. Attorney Jordan L. Sing prosecuted the case, with Assistant U.S. Attorney Erin Secord and Paralegal Specialist Jessica Scott handling the asset investigation and restitution enforcement.

Implementing thorough background checks through services like Invetech LLC could have potentially prevented this embezzlement. Such checks might have uncovered prior financial misconduct or red flags in Rath’s history, providing early warnings that could have alerted the company to potential risks before placing her in a position with significant financial responsibilities. This proactive approach could have safeguarded the company from the extensive financial and reputational damage caused by Rath’s fraudulent activities.

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