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More than $100,000 embezzled from school district

Cory Fisher and Christina Proctor

A former district employee has admitted she embezzled from the Lake Tahoe Unified School District, police investigators reported Tuesday.

Officials believe more than $100,000 was siphoned from the district.

Linda Marie Eddy, 41, of South Lake Tahoe, was questioned Thursday by police about the missing funds. She has not yet been charged.

A chance discovery of forged checks started the investigation.

Pat Howard had been director of child nutrition for just six months when she came across several canceled checks in the mail written out to Eddy, an accounting technician. The checks had two forged signatures – Howard and Business Manager Ralph Johnson’s. Howard didn’t usually sort the mail, but on Sept. 10, the first day of school, Eddy was away at a computer training course.

“Because she wasn’t there, I picked up my mail on her desk and started to go through it. I came across a bank statement. When I opened it I found two checks made out to her. I saw my signature and Ralph’s – I knew that wasn’t my signature, and when I showed Ralph he said it wasn’t his either,” Howard said. “It looked like an attempt to duplicate our signatures, but you know your own signature.”

Howard’s suspicions were first raised in June while reviewing profits and losses for the department of Child Nutritional Services.

“The numbers seemed odd,” Howard said. “They didn’t make sense but I couldn’t put my finger on it. I became wary.”

When confronted, Eddy allegedly admitted to numerous thefts of department funds. Eddy resigned in September soon after being placed on administrative leave.

The school district informed the South Lake Tahoe Police Department and employed independent auditors Smith & Perry of Sacramento to review food service office records. A one-year review revealed many discrepancies, Howard said, which resulted in a more detailed look of the past four years. Unable to locate canceled checks, investigators were forced to examine US Bank microfiche.

Detective Brian Williams said Eddy admitted to the embezzlement, citing personal finance problems as the reason.

“It appears that there was a lack of personal accountability and checks and balances in the department,” Williams said. “That lack of cross checks allowed Eddy to successfully take the funds without discovery for three years.”

Superintendent Rich Alexander said the accounts, routinely reviewed by Johnson, showed a loss in the cafeteria fund but were attributed to an increase of expenditures. Eddy allegedly labeled the missing funds as rises in vendor costs.

“It was done well, in a very clever manner, spacing it out over three years,” Alexander said. “Eddy was basically on her own – this was a fund that was relatively easier than others.”

In the wake of this discovery supervisors are now double checking all accounting practices, Alexander added.

The school district is protected by crime insurance and the district intends to file a claim now that the exact amount has been determined.

Pending a review of the case by the district attorney’s office, Eddy has not yet been arrested on any charges. The case was submitted to them on Tuesday.


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