Fraud and money laundering charges

A nun facing 40 years behind bars after embezzling more than $835,000 of school cash to fund her gambling habit has gotten off relatively lightly. US District Judge Otis D. Wright II sentenced her to one year and a day in federal prison for fraud and money laundering charges.

Kreuper must also pay $825,338.57

Besides the time in prison, Kreuper must also pay $825,338.57 in restitution for the tuition money she embezzled from St. James Catholic School in Torrance, California. Judge Wright released the LA native under her own recognizance, with the requirement she turn herself in to the Federal Bureau of Prisons by June 7 to begin her 366-day sentence.

The US Attorney’s Office for the Central District of California took to Twitter on Monday to announce 80-year-old Sister Mary Margaret Kreuper’s sentence:

The prosecutor of the case — Assistant US Attorney Poonam G. Kumar of the Major Frauds Section — said that upon release from prison, the former principal of the Catholic school will be under two years’ supervision.

In a plea agreement made June 8, 2021, Kreuper admitted using the embezzled funds to pay for trips to Las Vegas and Lake Tahoe, besides “large gambling expenses incurred at casinos.”

Abuse of a trusted position

Kreuper served as principal of St. James Catholic School for 28 years. Her embezzlement spree ran for ten years in that time, ending in 2018. The jag earned her a number six place in Vegas Slots Online News’ 10 Worst US Gambling Crime Headliners of 2021.

stole the equivalent of the tuition of 14 different students per year”

According to a Department of Justice (DOJ) news release, prosecutors argued in a sentencing memorandum that: “On an annualized basis (approximately $83,000 per year), [Kreuper] stole the equivalent of the tuition of 14 different students per year.”

Not only did the nun squander school funds on gambling trips, she also asked parents to donate more money to St. James Catholic School on top of their $6,000 annual tuition.

“This was really an abuse of position of trust, right,” Kumar told the New York Post. “She was the principal. She was running the school that these parents had chosen to send their children, and not just for the academics.”

Citing letters to the court, Kumar said that many parents wanted to give their children “a Catholic education with the morals and values that they believed in […] and that’s what they were looking for in the school.”

Reasons for leniency?

Prosecutors in the case only asked for a two-year prison sentence for Kreuper, despite the crimes she committed carrying a maximum statutory penalty of 40 years in federal prison.

During Monday’s sentencing, according the NY Post, Judge Wright expressed his struggle to find the proper sentence for Kreuper, adding she was “one heck of a teacher.”

“But somewhere along the line,” the judge said, “you just ran completely off the road, and I think you understand that. At least I hope you do.”

During Monday’s sentencing, the disgraced nun did not try to defend her actions. “I have sinned, I have broken the law, and I have no excuses,” Kreuper reportedly stated.