Date: October 27, 2023 Contact: newsroom@ci.irs.gov Memphis, TN — A former account manager at a Memphis marketing firm has been sentenced to federal prison in connection with a scheme to defraud her employer of more than $1,000,000. Kevin G. Ritz, United States Attorney for the Western District of Tennessee, announced the sentence today. On October 18, 2023, United States District Court Judge John T. Fowlkes, Jr. sentenced Karen Winkles Crutchfield of Southaven, Miss. to 75 months incarceration followed by five years of supervised release. In addition, Fowlkes ordered Crutchfield to pay $1,058,266 in restitution to her former employer and other victims. There is no parole in the federal system. This case was investigated by the Internal Revenue Service Criminal Investigation and the Secret Service. "Financial fraud can happen anywhere, and can be devastating to local businesses," said United States Attorney Ritz. "The defendant used her position of trust and authority to defraud a small business for her own personal benefit. Thanks to our investigative partners, her callous dishonesty has been exposed. Wherever fraud occurs in the Western District of Tennessee, this office will be prepared to hold offenders accountable." "Financial fraud undermines the integrity of the U.S. tax system and breaks down consumer confidence," said Donald "Trey" Eakins, IRS Criminal Investigation's Charlotte Field Office Special Agent in Charge. "We, along with our federal partners, will continue to hold perpetrators accountable for their actions." "Small business owners sacrifice every day to help build the United States economy," said Special Agent in Charge Mark Switzer, US Secret Service, Memphis Field Office. "When a trusted employee steals from their employer, it undermines all the work and opportunity those employers give to their community. The Secret Service appreciates the opportunity to work with our investigative partners to assist in bringing justice to this business in Western Tennessee." According to the indictment and information presented in court, between 2013 and 2019, Crutchfield was employed as an account manager at Good Advertising in Memphis. In that capacity, she handled company payroll, accounts receivable, and accounts payable. Crutchfield used her access to create false invoices, duplicate or fictitious vendors, and more than 620 fraudulent checks, totaling approximately $662,000. In addition, she stole more than $168,740 from the owners' profit-sharing account and used company credit cards to pay nearly $59,000 in personal expenses and withdraw $82,000 in cash advances. She inflated her wages, telling the company's payroll processer that her annual salary was $95,000 – more than double the $45,000 she legitimately earned. Crutchfield used her access to the company owners' personal identifying information to apply for a business loan without permission, in an apparent effort to cover the shortfall caused by her theft. Finally, Crutchfield filed false tax returns with the IRS, failing to declare the income she obtained from her fraud schemes. A federal grand jury returned an indictment against Crutchfield in April 2022. Crutchfield appeared before Judge Fowlkes and entered a guilty plea to the charges of bank fraud, wire fraud, aggravated identity theft, and filing a false tax return. Assistant United States Attorney Mark Erskine prosecuted this case on behalf of the federal government.
