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Officials describe alleged workforce scheme

March 3, 2019 GMT

KANKAKEE — LaDonna Russell, who heads the local agency that deals with workforce issues, has a simple description for the agency’s former bookkeeper: “She’s good.”

She is not referring to the bookkeeper’s competence or morals. Rather, she is talking about Deborah Lake’s ability to pursue an alleged scheme to steal public money, using intricate methods to avoid detection.

According to federal court documents, Lake is facing charges that she stole more than $30,000 in government money from the Kankakee-based Grundy Livingston Kankakee Workforce Board.

Lake, who also is known as Deborah O’Neill and Deborah G. Mitchell, is free on her own recognizance. According to an affidavit she filed in U.S. District Court, Lake now lives in an assisted-living facility, making about $900 per month. It is unclear which town she lives in.

Lake started at the workforce board in October 2008, when Elisabeth Dunbar was the executive director. Dunbar left in January 2011.

Lake’s alleged theft occurred from November 2010 to October 2014. She performed bookkeeping tasks, including payment of bills and reconciliation of expense accounts.

The workforce board is funded by grants from the U.S. Department of Labor, money that passes through the Kankakee County government.

One Friday in October 2014, Russell recalls, then-County Board Chairman Mike Bossert and a sheriff’s detective walked into the workforce board to inform her of Lake’s suspected theft.

As it happens, Lake was gone that day. Russell said Lake informed her she was in the hospital — a fact that Russell confirmed when she called the hospital and was transferred to Lake’s room.

On Oct. 31, 2014, Lake was fired for cause.

“The county did their due diligence. A case was opened at the Office of Inspector General at the Department of Labor,” Russell said.

The County Board’s current chairman, Andy Wheeler, said he expected the county to be on the hook for the money that Lake stole, which the federal government alleges is more than $30,000.

“In a $31 million budget, the money isn’t insignificant, but it won’t close us down,” Wheeler said. “The feds might say the county has to pay, then she owes us. I can’t see the feds walking away from that.”

In her job, Lake entered billing information into the board’s accounting program, which she alone maintained, the federal complaint says.

As part of her scheme to defraud the board, Lake entered vendor invoices for amounts more than what was owed, according to federal prosecutors.

She manipulated the account software so that it appeared the checks were payable to the vendors, but altered them to be made payable to herself, according to the complaint.

Lake created fraudulent invoices for vendors who previously had done business with the board and created checks payable to herself, forging signatures of those authorized to sign them, the complaint says.

“The indictment is true and accurate. Everything is correct,” Russell said. “We have changed how we do things. We are moving forward.”

The investigation began after a vendor called the county’s finance department about where a certain check was, Wheeler said.

“(Lake) let one slip through,” he said.

Now, Russell said she handles bank reconciliations, which provides oversight for the bookkeeper. Russell also can log into the accounting program, while only Lake had access to it before.

Wheeler said the case was a “great lesson.”

“The same person who does the accounting cannot also do the auditing,” he said.

Russell said she was glad the board backed her through the Lake investigation.

“We do good jobs here. I feel like it’s a blemish. I hate having a blemish on my record,” Russell said.

As for the federal case’s outcome, Russell said, “Restitution is high on my list. I want to see the money back.”

A trial date for Lake has not been set.

The workforce board, which serves Kankakee, Livingston and Grundy counties, was created in 1998 to design programs to train skilled workers for local businesses. The board also provides career assistance and counselors to low-income people, including students.