A judge in Utah handed out a nearly four-year prison sentence to a former secretary for a Murray, Utah, painting contractor for stealing $1.3 million in customer payments.
Pamela Sue Madsen, 39, of Bluffdale, Utah, was sentenced to 46 months in prison, followed by five years’ probation, by U.S. District Judge Ted Stewart, according to news reports.
Madsen also was ordered to pay back the stolen money and forfeit three snowmobiles and four other vehicles, Salt Lake City’s Deseret News reported.
In a plea bargain with prosecutors, Madsen admitted to diverting customer payments from Professional Painting Inc. into a personal account. She was indicted in 2011 on five counts of mail fraud and four counts of money laundering.
Madsen’s duties for Professional Painting Inc. included payroll, data entry and preparing checks for deposit. Prosecutors say Madsen created an account at U.S. Bank in November 2007 under a slight variation of her employer’s name, the Deseret News reported. For the next three years, she deposited customers’ checks totaling at least $1.3 million into the account for her personal use, according to the indictment.
Madsen credited customers’ accounts on the company’s books to make it look like they had paid their bills, according to an indictment handed down in 2011. Some of the checks came from two of the state’s largest general contractors, Jacobsen Construction and Big-D Construction, the Deseret News reported.
Russ Christensen, president of Professional Painting, told Durability + Design the case was a “regrettable situation” caused by a dishonest employee in whom the company placed trust.
“I’m glad she was caught and is going to prison. As far as further comment, all I can say is that it’s a regrettable situation,” Christensen said.
Christensen said the financial losses resulting from the theft scheme forced the company to cut back on compensation and benefits and take other measures to deal with what were believed to be the effects of a weak economy.
“The biggest mistake we made was developing trust with her. She worked here for 10 years, and when she started picking up the mail for us is when the scheme started,” Christensen said.
At the same time, Madsen’s duties also gave her access to financial functions, which provided opportunity for the fraud to occur.
“My advice would be, put controls in place where people do certain things, and not several things” to ensure accountability and honesty, Christensen said.
“We trusted and allowed her to do too much.”