Former head of Kansas City University of Medicine and Biosciences charged with stealing $1.5 million

Kasim Hardaway

On Thursday April 31, former president and CEO Karen Pletz of the Kansas City University of Medicine and Biosciences (KCUMB) was charged with a 24-count indictment against the university.

According to “NBC Actions News,” Pletz has garnered over $1.5 million from the university during her employment.

Sources say this was done through “unauthorized compensation payments as well as reimbursements from the university for personal expenses and fraudulent charitable contributions. She is also accused of tax violations and money laundering.”

U.S. Attorney Beth Phillips explained the 24-count indictment.

It includes four counts of money laundering ($1.4 million in pay fraud, $50,000 in travel fraud and $65,000 in charity fraud).

Pletz was also charged with 16 counts of theft from the university, one count of attempting to obstruct the administration of internal revenue, and three counts of providing false information on tax returns.

“Pletz did not make these charitable donations, in fact the university made the charitable donations. Pletz then submitted fraudulent statements to the university, and received a reimbursement of $65,000 dollars for the donations that she did not actually make,” Phillips said.

A lawsuit was filed by the university for the supposed allegations.

The KCUMB Board of Trustees voted unanimously for the termination of Pletz in December 2009 after allegations of incorrect self-compensation surfaced.

“The grand jury’s charges handed down today speak for themselves in describing a sophisticated pattern of alleged deception and misconduct on the part of Karen Pletz,” said KCUMB council member, and partner with the Berkowitz Oliver firm, Jeff Morris.

A counter-suit was filed by Pletz against the university, which she claims wrongfully terminated her, and that the accusations presented against her were blown out of proportion.

“KCUMB has cooperated fully with the government’s investigation,” Morris said. “The University has made available evidence that caused the University’s termination of Ms. Pletz in 2009, along with evidence uncovered during the civil lawsuits that followed that termination.”

Attorney Brandon J.B. Boulware of Rouse Hendricks German May, representative of Pletz, had the following to say this past Thursday:

“With today’s indictment, the federal government has injected itself into the civil litigation dispute between KCUMB and its former President, Karen Pletz. All of the issues raised in the indictment are also the subject of the ongoing IRS audit of KCUMB and its board of trustees as well as the civil lawsuit, which after filing one year ago KCUMB has done everything in its power to avoid litigating.”

“It is unfortunate, in our view, that local federal prosecutors would choose to spend public resources on a case like this when there are other, legitimate processes already at work to resolve the issues in dispute. Ms. Pletz denies and will fight the government’s charges, and pleads not guilty to any federal crimes,” Boulware said.

Pletz has pleaded not guilty to the charges.

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