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Federal Court Sentences Kentucky Woman to Prison, Orders $838,804 In Restitution After U.S. Department of Labor Finds Benefit Plan Fraud
LOUISVILLE, KY – After an investigation by the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA), the U.S. District Court for the Western District of Kentucky has sentenced Candi Fluhr, a former controller in Bullitt County, Kentucky, to 94 months in prison, 36 months of supervised release, and ordered her to pay $838,804 in restitution.
The court’s action follows Fluhr’s July 2020 guilty plea to four counts of wire fraud, one count of aggravated identity theft, one count of theft from an employee benefit plan and two counts of filing a false tax return.
EBSA found that – between May 2016 and January 2018 – Fluhr used her position as controller at Meyer Plumbing and created schemes whereby she issued unauthorized checks made payable to herself and others, and used multiple company debit and ATM cards to withdraw cash and pay for her own personal expenses. She also made fraudulent payments from Meyer Plumbing to an insurance company for the purpose of obtaining and maintaining health insurance coverage for herself and family.
The investigation also determined that Fluhr failed to remit employee contributions in the amount of $31,882 to the Meyer Plumbing 401(k) Plan, an employee pension benefit plan subject to the Employee Retirement Income Security Act (ERISA). Instead, Fluhr stole the employee contributions and fraudulently altered Meyer Plumbing’s bank account statements to make it appear that proper remittances were made to the benefit plan.
Through this scheme detailed above, Fluhr attempted to obtain and obtained funds totaling $756,703, to which she was not entitled. Once the scheme was uncovered, she attempted to repay certain funds to Meyer Plumbing. Her actions led to a total loss to Meyer Plumbing of $633,044.
In addition to defrauding Meyer Plumbing, Fluhr failed to report $649,044 in embezzled funds, which led her to file a false tax return in 2016 and 2017, resulting in a criminal tax loss of $158,270. In addition, while employed as an office manager at JLM Services in Louisville, Kentucky, from June to October 2019, she defrauded that company and caused losses of $39,749 in funds by scheduling payroll payments to fictitious employees and former JLM workers and re-routed the funds to a prepaid debit card she accessed. She also used JLM Services’ credit cards and checking accounts without company authorization to make personal purchases.
“Criminal acts like this directly impact participants in employee benefit plans by compromising their hard-earned benefits, while eroding confidence in those chosen to manage their future retirement security,” said Employee Benefits Security Administration Regional Director L. Joe Rivers, in Cincinnati, Ohio. “The U.S. Department of Labor’s Employee Benefits Security Administration is committed to ensuring the integrity of employee benefit programs and prosecuting those that fail to comply with the law.”
Employers and workers with problems related to private sector retirement and health plans should contact EBSA toll-free at 866-444-3272. More information is available.
EBSA’s mission is to assure the security of the retirement, health and other workplace related benefits of America's workers and their families. EBSA accomplishes this mission by developing effective regulations; assisting and educating workers, plan sponsors, fiduciaries and service providers; and vigorously enforcing the law.
The mission of the Department of Labor is to foster, promote and develop the welfare of the wage earners, job seekers and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights.