Former IU Foundation employee sentenced to year in prison, ordered to pay restitution for embezzlement scheme

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A former Indiana University Foundation employee has been sentenced to federal prison for stealing more than $300,000 in donations from the foundation over a nearly four-year span.

Teresa Maners, 64, of Spencer, was sentenced to one year and one day after pleading guilty to wire fraud in July.

According to the United States Attorney’s Office for the Southern District of Indiana, Maners was employed with the IU Foundation as a depositor and payroll deduction associate beginning in 1988. Her job duties included recording cash and checks received from donors and preparing them for deposit in the foundation’s bank account.

During her employment, Maners stole hundreds of thousands of dollars from the foundation by taking cash before recording it in the foundation’s accounting systems.

To hide the stolen cash, Maners secretly withheld checks from the day’s deposits and substituted those checks in a subsequent day’s deposit. She also wrote checks to the foundation from her personal bank account to cover any difference between the substituted donor checks and the stolen cash. That type of fraud is sometimes referred to as a “lapping scheme,” according to the USAO.

As the only employee in charge of recording cash donations, Maners was able to alter the accounting paperwork to “balance” the books and keep the stolen cash donations for herself.

According to court documents, beginning on or about Dec. 30, 2015, and continuing until on or about Aug. 21,2019, Maners continued the fraud. She stole approximately $326,334 from the foundation.

In 2019, the foundation conducted an external audit after discovering accounting irregularities and confronted Maners, who admitted to stealing the money.

“For years, this defendant abused her position of trust to line her own pockets and steal hundreds of thousands of dollars in charitable donations from a foundation dedicated to advancing important educational programs in our state,” U.S. Attorney Zachary A. Myers said in a news release. “Our office and the FBI are dedicated to identifying criminals who steal from and defraud our charities, businesses, and government organizations and holding them accountable. The federal prison sentence imposed here demonstrates that financial crimes cause serious harms and merit serious punishment.”

The FBI investigated the case.

Indiana Southern District Court Judge Jane Magnus-Stinson ordered that Maners be supervised by the U.S. Probation Office for two years following her release from federal prison and pay $326,334.64 in restitution.

The case is United States of America v. Teresa Maner, 1:23-cr-107.

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