ST. LOUIS – Paula Smith, 69, of O’Fallon, Missouri, appeared before United States District Court Judge Matthew T. Schelp on today’s date. Smith was sentenced to 46 months in federal prison. Smith previously pleaded guilty to three counts of mail fraud and one count of money laundering.
Smith was a bookkeeper at an accounting firm that managed a lucrative trust account for a client (the D.E.W. Trust). The D.E.W. Trust, which was at one time valued at $8.6 million, had over twenty named beneficiaries, including twelve charitable organizations in St. Louis, Missouri. Between October 2013 and June 2018, Smith defrauded the D.E.W. Trust and its beneficiaries by writing numerous checks totaling $670,000 from the D.E.W. Trust to herself. None of the funds should have gone to Smith.
To conceal her scheme, Smith manipulated the accounting records for the D.E.W. Trust by mislabeling the fraudulent checks as being advance payments to a trustee and as payments to a vendor. As a result of these fraudulent transactions, there were less available funds to be properly distributed to the intended charitable organization beneficiaries of the D.E.W. Trust.
Smith used the funds to personally enrich herself, including to buy a 2017 Chevrolet Silverado K1500 and a 2018 Keystone Hornet Hideout 26RLS Travel Trailer.
“People who think they can get away with embezzling money should realize the crime eventually catches up with them like it did with Paula Smith,” said Acting Special Agent in Charge Spencer Evans of the FBI St. Louis Division. “While Smith enriched herself in the short term, she will now pay a much higher price with a sentence of almost 4 years in federal prison.”
The above case was investigated by the Federal Bureau of Investigation with assistance from the Montgomery Bank Anti-Money Laundering Team. Assistant United States Attorney Kyle T. Bateman is handling the matter.
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