A former Mark Twain House & Museum employee who embezzled more than $1 million from the organization between 2002 and 2010 pleaded guilty Friday to one count of wire fraud and one count of filing a false tax return.
Donna Gregor, 58, of East Hartford, waived her right to a trial before Senior U.S. District Judge Warren Eginton at U.S. District Court in Bridgeport.
According to court documents and statements made in court, Gregor, who had been with the Twain House for 20 years and was working as controller at the time of her dismissal in June 2010, employed two different schemes.
In one, Gregor submitted false information via the Internet to the organization's payroll management vendor to receive additional pay that she was not entitled to. The money was deposited directly to Gregor's personal bank account as "payroll advances."
Gregor then adjusted the general ledger to hide the advances by classifying the amounts as payments to other accounts, including maintenance and utilities.
Gregor also used the Twain House's check-writing system to write checks to herself, forging her supervisor's signature and depositing them in her personal bank account, according to court documents. She then adjusted journal entries in the general ledger and falsified bank statements to hide the fraudulently prepared checks.
Gregor was found to have embezzled $1,080,811.76 and used the proceeds to make home improvements, dine out, purchase theater tickets and make car, credit card and mortgage payments.
She also failed to pay federal taxes on the money she embezzled from 2002 to 2010 and underpaid her taxes by $322,970, according to the Internal Revenue Service.
Eginton has scheduled sentencing for Oct 24. Gregor faces a maximum prison term of 23 years and a fine of about $2 million. She will also be ordered to pay restitution to the Twain House and the insurance company that has paid the Twain House $500,000 as a result of the loss.
U.S. Attorney David B. Fein called the case a breach of trust by an employee of a Hartford landmark and institution of learning.
"Employees who steal from employers that rely so heavily on the contributions of individuals to operate are, in effect, stealing directly from those contributors," Fein said Friday. "As a result, we will strongly advocate not only for an appropriate prison sentence, but also for restitution of stolen funds."
Gregory Boyko, president of the Mark Twain House & Museum's board of trustees, said Friday that Twain officials uncovered the scheme on June 22, 2010, when a bank questioned a signature on a check and called Jeff Nichols, the organization's executive director. Gregor had forged her supervisor's name on the check, Boyko said.
"We notified police immediately," Boyko said. Gregor was terminated that day.
Boyko said that the Twain House did not have insurance coverage for about $580,000 stolen between 2002 and 2007, but added that the museum plans to pursue every avenue to recoup the loss. The other $500,000 in losses from 2008 to 2010 was covered by insurance.
Boyko said that additional financial controls have been implemented and that he did not believe the incident would hurt the organization's fundraising efforts.
The thefts deepened financial troubles that the museum began experiencing in 2003, when it opened a new $18 million visitor center. In addition to construction cost overruns for the project, the museum had increased expenses in other areas.
By 2006, the museum was forced to restructure its debt on the visitor center project and received a $3.5 million grant from the state to avoid bankruptcy. In 2008, facing a $350,000 deficit in its operating budget, the museum received a $50,000 grant from United Technologies Corp. and a $30,000 grant from the National Endowment for the Humanities, and it laid off 33 of its 50 employees.
Nichols said recently that the museum is on the mend financially, finishing "in the black the last three years," and whittling down its operating deficit to an "almost break-even" point.
JUST THE FACTS
CHARGE: DONNA GREGOR CHARGED WITH EMBEZZLING MORE THAN $1 MILLION FROM MARK TWAIN HOUSE & MUSEUM BETWEEN 2002 AND 2010.
Plea: She pleaded guilty Friday to one count of wire fraud and one count of filing false tax return.
Money Trail: Investigators say she used the money to make home improvements, dine out, purchase theater tickets and make car, credit card and mortgage payments.
Court Date: Sentencing is scheduled for Oct 24. Gregor faces a maximum prison term of 23 years and a fine of approximately $2 million.
Reprinted with permission of the Hartford Courant.
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