Dive Brief:
- The former CFO of a Dallas-based Child and Family Guidance Center was sentenced to five years in federal prison for embezzling over $2 million between September 2016 and January 2023 from the non-profit, according to a Friday release from the U.S. Attorney for the Northern District of Texas. CFGC provides mental and behavioral health services in North Texas.
- Jeffrey Scott Keehn, 55, of Imperial Beach, California, was charged with forging signatures of the nonprofit’s CEO and COO on the charity’s checks and depositing them into his own personal accounts via a “remote deposit capture” function of the mobile apps for Frost Bank and Capital One, according to an August 2024 indictment filing.
- Keehn pled guilty to one count of wire fraud and was sentenced Wednesday by U.S. District Judge Ed Kinkeade, according to a Wednesday filing. The court dismissed the remaining seven counts and recommended the ex-CFO serve his sentence at FCI Lompoc II in Lompoc, California, according to a Wednesday court filing. He must also pay back the full amount of $2.1 million that he stole.
Dive Insight:
While the case has been winding its way through the legal system for several years, the sentencing comes as the second Trump Administration is focusing on pursuing enforcement cases that tackle fraud. In April, the DOJ announced a new fraud division.
Keehn’s sentence and the restitution he must make show that the DOJ will hold those who exploit nonprofits accountable, according to the release, the U.S. attorney’s office said.
“Stealing from a charity that serves families in crisis is unconscionable,” U.S. Attorney Ryan Raybould said in a statement in the release. “Mr. Keehn’s fraud didn’t just drain the charity’s finances; it forced them to divert time and resources away from their mission.”
Keehn concealed the scheme by falsely recording checks in QuickBooks as payments to medical providers and vendors and misrepresenting the company’s available cash in financial reports, according to the indictment. He also wrote the checks for less than $10,000 so they didn’t require the signature of the organization's president or treasurer.
Keehn used the money to support his “personal lifestyle,” including his home in Texas, a secondary residence in California, a new Chevrolet SUV, and purchasing of precious metals, prosecutors said. For example, a $22,495 wire transfer from Keehn’s own Frost Bank account was sent on March 22, 2022 to the U.S. Gold Bureau to purchase silver, palladium, and platinum American Eagle coins and a firesafe, according to the indictment.
According to the sentencing agreement, Keehn must make restitution of $1.8 million to the Child and Family Guidance Center and of a total of about $260,000 to Berkley Human Services, Berkeley Regional Ins. Co. He must also forfeit any property he obtained from the scheme, including cash in lieu of a 2022 Chevrolet Traverse High Country SUV, gold, silver, platinum and palladium coins, and $225,655 in equity related to a property in Oceanside, California.
Keehn will begin his sentence on Oct. 14 and after he serves his time, he will be on supervised release for three years, according to a Wednesday filing.
Keehn’s attorney Joe Magliolo declined to comment.
