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Bear Lake woman gets two years for embezzlement

A Bear Lake woman has been convicted and sentenced for embezzling nearly $750,000 from Corry Area Schools Federal Credit Union.

According to a release from the Western District of Pennsylvania U.S. Attorney’s Office, Karen Schenck, 50, was sentenced to two years in jail and five years of supervised release.

Schenck was also ordered to pay restitution in the amount of $696,273.72.

According to the release, Schenck was employed as the office manager and CEO of the credit union from January 2008 through August 2015. During that time, Schenck embezzled $741,362.

Information presented at court showed that Schenck made $268,402.25 in unauthorized or fictitious loans in the names of her family members and used the funds “for her personal benefit or to conceal out-of-balance conditions in various general ledger accounts.”

She also made more than 60 fictitious deposits into her own account and the accounts of family members — a total of $317,897 — “which she used for her personal benefit.”

Schenck made withdrawals of $51,035.03 and $44,572.47 from accounts without the authorization of the account holders.

According to the release, Schenck fabricated loan underwriting documents to make it appear that she would have qualified for the $42,118.07 in loans that she created for herself.

She also used embezzled funds to pay off personal credit card balances, creating another $17,338 in losses for the credit union.

The FBI investigated the case and Assistant U.S. Attorney Marshall Piccinini prosecuted. U.S. District Judge David Cercone presided over the case and imposed the sentence.

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