Nun charged for stealing $800,000 from school in Los Angeles for gambling

A nun from Los Angeles, who was the principal of a Catholic school for 28 years, was charged by federal prosecutors on Tuesday for allegedly stealing more than $835,000 from school funds to pay for personal expenses, including gambling.

Mary Margaret Kreuper, 79, who as a nun had taken a vow of poverty, was charged with one count of wire fraud and one count of money laundering. She has pleaded guilty and can face 40 years in federal prison.

According to a statement from the US Attorney’s office, Ms Kreuper embezzled money “for a period of 10 years ending in September 2018” from St James Catholic School in Torrance, California.

It said that as principal, she was “responsible for the money the school received to pay for tuition and fees, as well as for charitable donations.” It is also alleged that she directed school employees to “alter and destroy financial records during a school audit.”

The investigation by the Torrance Police Department, the Federal Bureau of Investigation and IRS (Internal Revenue Service) Criminal Investigation revealed that over time, she caused losses to St James Catholic School totalling $835,339 (£ 590,000). She is scheduled to appear in US District Court on 1 July.

“Ms Kreuper controlled accounts at a credit union, including a savings account for the school and one established to pay the living expenses of the nuns employed by the school,” the statement said.

She diverted school funds and used them “to pay for expenses that the order would not have approved, much less paid for, including large gambling expenses incurred at casinos and certain credit card charges.”

The attorney’s office said Ms Kreuper further admitted in her plea agreement that she falsified monthly and annual reports to the school administration to cover up her fraudulent conduct and “lulled St James School and the administration into believing that the school’s finances were being properly accounted for and its financial assets properly safeguarded.”

This, the statement said, allowed Ms Kreuper to “maintain her access and control of the school’s finances and accounts and, thus, continue operating the fraudulent scheme.”

A statement from the nun’s attorneys said she was “very remorseful for what happened” and had been cooperating with law enforcement and the Roman Catholic Archdiocese of Los Angeles.

Ms Kreuper became a nun at 18, according to a report by the KNX-AM radio.

“Unfortunately, later in her life she has been suffering from a mental illness that clouded her judgment and caused her to do something that she otherwise would not have done. She is very sorry for any harm she has caused,” the statement said.

Additional reporting by agencies

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