A federal grand jury has indicted Karen Pletz, the former president and CEO of Kansas City University of Medicine and
Biosciences, for allegedly embezzling more than $1.5 million from the university.
Pletz, 63, was charged in a 24-count indictment that was unsealed today. She served as president and CEO of KCUMB and as a member of the university's board of trustees from 1995 until December 2009. The feds allege that Pletz embezzled $1,525,791 from KCUMB in payments from the osteopathic medicine and life sciences school.
She's accused of concocting minutes for KCUMB Executive Committee
meetings that never occurred. The minutes from the nine meetings between
October 2002 and December 2009 showed that the only business at the
meetings was to authorize payments to Pletz, which were called
"leadership stipends" or "leadership compensation." She usually got a
lump sum of $65,000 and pulled a total of $1,409,500.
Pletz is also accused of paying herself to visit her parents at the
Harbor Beach Marriott Resort in Fort Lauderdale, Florida, in 2007; to
visit a friend at the Four Seasons Hotel in Jackson Hole, Wyoming;
and to visit high school friends at the Wild Dunes Resort, Isle of Palms
in Charleston, South Carolina. She also is accused of reimbursing
herself for $11,846 worth of stuff she bought at a Vera Wang boutique at
Halekulani Hotel in Honolulu, Hawaii. Pletz is accused of failing to
declare the $50,291 in total income, which she received from KCUMB for these
reimbursements, on her federal income tax returns. The indictment alleges that Pletz received $1,074,917 in unreported
income from disallowed travel and entertainment claims, which led to a
tax loss to the United States of at least $280,000.
Pletz is also accused of filing tax returns for 2003 through 2006 in
which she falsely claimed itemized
deductions for charitable contributions that she did not make. The feds
say the truth is that KCUMB made the contributions. Pletz allegedly
claimed $565,628 worth of fraudulent charitable
deductions to the United Way, Lyric Opera, the Deron Cherry Foundation,
Boys and Girls Clubs, and Truman Medical Center.
Among the allegedly fraudulent charitable contributions was $65,000 to
Benedictine College in Atchison, Kansas. That donation was made by
KCUMB, the feds say. Pletz is accused of getting reimbursements from
KCUMB for those contributions over a three-year period and failing to
report the $65,000 as income.
Pletz is also facing charges of money laundering for four separate
occasions when she allegedly transferred money obtained by theft from
her bank account to American Express.
The government is trying to take away Pletz's 2002 Lexus convertible
and $39,337 from her bank account, which federal agents seized in
October. They're also after an $830,000 judgment and Pletz's Plaza
Pletz is facing 16 counts of stealing from the university, one count of attempting to interfere with
the administration of internal revenue, three counts of making false
statements on tax returns, and four counts of money laundering.