Minnesota woman pleads guilty to embezzling $1 million from employer

A Brooklyn Park, Minn., woman has pleaded guilty to cooking up a scheme to embezzle more than $1 million from her employer to feed a gambling habit.

A Brooklyn Park, Minn., woman has pleaded guilty to cooking up a scheme to embezzle more than $1 million from her employer to feed a gambling habit.

Cynthia Carol Jacobsen admitted to a single count of mail fraud in a plea hearing before a federal judge in St. Paul on Thursday.

No sentencing date has been set, but U.S. District Judge Donovan Frank told the woman that under federal sentencing guidelines, she could face a maximum of four years and three months in prison.

She'll also be expected to pay almost $1.05 million restitution to Land O'Lakes Inc., of Arden Hills, where she spent nearly four years running an accounts-payable scam that sent 489 checks for bogus vendors to her home.

Nobody was quite sure how she would pay restitution. "I know she doesn't have any money now," Assistant U.S. Attorney Chris Wilton said after the hearing.


Jacobsen, 58, answered only "yes" or "no" as Frank asked questions to determine if she realized the rights she was waiving by pleading guilty instead of going to trial.

She did not explain her actions, nor was she asked to.

But Wilton told the judge that the woman had "on her own ... started taking steps in the right direction." The judge told her that while awaiting sentencing, she is barred from gambling at a casino or online and can't play a lottery scratch-off game.

He also said she is to get mental health counseling and look into groups like Gamblers Anonymous while awaiting sentencing.

Last month, prosecutors charged Jacobsen with a single count of mail fraud in the scheme, which stemmed from her job as an accounts-payable supervisor at the dairy and food co-op.

One of her duties was to authorize payments to the company's vendors. In 2008, she listed her daughter as a vendor and began authorizing payments to her, listing her as various businesses.

"It wasn't always the same, and there were different vendors," Wilton said. "She literally just made it up."

The bogus businesses shared the same address, though: Jacobsen's residence. When the checks arrived, she forged her daughter's signature and cashed them.


The prosecutor told the judge Jacobsen's daughter did not know of the scheme and saw none of the money.

The scam ended in May when an employee suspected Jacobsen of wrongdoing. The company performed an audit and contacted federal officials.

The amount she admitted embezzling was $1,046,152.79. The mail-fraud count stems from a check for $2,599 mailed Dec. 30.

Mail fraud carries a maximum sentence of 20 years in prison, a fine up to $250,000 and restitution. But in the plea deal, both sides agreed that with her circumstances, federal sentencing guidelines call for a sentence from 41 to 51 months.

Jacobsen also agreed she could be fined up to $7,500, but Frank told her his priority would be getting her to pay restitution.

It isn't Jacobsen's first brush with money troubles or the law. In 2002, when she worked in Best Buy's accounting department, she filed for Chapter 7 bankruptcy, listing liabilities of more than $86,500 and assets of $11,230.

Among her debts: $41,000 owed on 18 credit cards.

A judge discharged her debts in April 2002.


Twelve years earlier, Jacobsen pleaded guilty in Hennepin County District Court to a misdemeanor count of aggravated theft-by-swindle involving $17,199.

Court records show she was placed on five years' probation, received a stay of imposition and completed her probation in March 1995.

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