Two Catholic Nuns embezzle $500,000 from school!

The nuns liked to gamble. Their parish learned that the hard way.

It wasn’t until Sister Mary Margaret Kreuper and Sister Lana Chang retired earlier this year from their jobs as principal and vice-principal of St. James Catholic School in Torrance, Calif., that the church stumbled upon what officials describe as a long con.

Over the course of roughly a decade, the sisters embezzled a “substantial amount” of money from the school, Msgr. Michael Meyers, the pastor of St. James Catholic Church, said in a letter to parishioners last month. Their religious order, the Sisters of St. Joseph of Carondelet, said they had confessed to the “misappropriation of funds.”

At a meeting with parents last week, Monsignor Meyers estimated the amount of stolen money at $500,000. One church official said it was believed that they had spent at least part of that on gambling and trips to casinos.

“I can say that it has been shocking for everyone, the entire school community and the parish as well,” said Adrian Alarcon, a spokeswoman for the Archdiocese of Los Angeles.

Sister Mary Margaret, 77, was a pillar of the community who spent 29 years as the principal of St. James Catholic School. Sister Lana, her 67-year-old accomplice, worked there for 20 years as an administrator and eighth-grade teacher.

Both declined to be interviewed, according to their religious order, which said in a statement that it would reimburse the school. Monsignor Meyers and Noreen Maricich, the new principal, also did not respond to messages this week seeking comment.

“As a religious community, we will not defend the actions of our Sisters,” the Sisters of St. Joseph of Carondelet said in a statement. “What happened is wrong. Our Sisters take full responsibility for the choices they made and are subject to the law.”

Church officials initially sought to address the embezzlement internally and “weren’t desirous of an investigation and weren’t desirous to press charges,” said Sgt. Ronald Harris, a spokesman for the Torrance Police Department.

But Sergeant Harris said that changed on Dec. 6, the day after the community meeting where the $500,000 figured was cited. Church officials came to the station house and said they had decided to press charges, he said, and an investigation is now underway.

“This is not going to be a small investigation,” he said. “Our goal is to be very thorough, but we need the cooperation of all parties.”

Ms. Alarcon confirmed the archdiocese had changed its mind about an investigation when it began to realize the potential magnitude of the theft. But she said it was not yet clear exactly how much the nuns had taken — in part because they appeared to have created a tangled financial arrangement to cover their tracks.

“It looks like the sisters would funnel funds back into the school to meet the needs of the school,” she said.

Beyond that, she said, the archdiocese could not say for sure what had happened to the money. She said the church hoped the investigation into the sisters would provide “a solid idea of what they did with the funds.”

The sisters’ graft was discovered when the school conducted a review of its finances as part of the change in its administration after Sister Mary Margaret’s retirement.

A red flag emerged around that time, Ms. Alarcon said, when a family that had donated money to the school alerted officials to something alarming on their bank statement.

“They found out that the check was deposited into a checking account that wasn’t the school’s checking account,” Ms. Alarcon said. She said the check went into a personal bank account used by the sisters.

Monsignor Meyers told families at the community meeting that Sister Mary Margaret became anxious when church officials learned of the suspicious donation check and asked her staff to alter the school’s financial records, according to a report in The Long Beach Press-Telegram.

At the meeting, auditors from the archdiocese told families that Sister Mary Margaret was the first point of contact for tuition and donation checks arriving at the school. She would give some of them to the accounting staff, but would keep others for herself and Sister Lana.

In his letter to the parish, Monsignor Meyers said that no other staff members were “implicated or responsible” for the scheme and that the school had adopted “additional procedures and oversight policies for financial management and reporting responsibilities.”

The Sisters of St. Joseph have been tight-lipped about the whereabouts of the two nuns.

In a statement on Tuesday, the order said that the nuns had been “removed from their residence and placed in a religious house under the supervision of community leadership” and that “Canonical Restrictions have been imposed” on them. The order did not elaborate.

Source: Nytimes