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Former National President of Children's Blanket Charity Sentenced for Stealing More Than $400,000 from the Organization
justice.gov ^ | March 5, 2021 | U.S. Attorney’s Office Central District of Illinois

Posted on 03/07/2021 3:07:15 PM PST by ransomnote

PEORIA, Ill. –The former national president of Project Linus, Carol Babbitt, 61, was sentenced to more than two years in prison for stealing money from the not-for-profit organization. Project Linus provides handmade blankets for children who are seriously ill, traumatized, or in need. Babbitt, currently of Asheville, N.C., was ordered to serve 30 months in prison and to pay restitution in the amount of $410,250 to Project Linus and $7,856 to the Illinois Department of Revenue. Babbitt was ordered to report to the federal Bureau of Prisons on May 11, to begin serving her prison term.

At the March 4th hearing, prior to sentencing, Babbitt formally entered pleas of guilty to all counts of the indictment which charged her with five counts of mail fraud, eight counts of wire fraud, and five counts of money laundering. Members and directors of the Project Linus organization attended the hearing and provided victim impact statements detailing their devotion to the work of Project Linus and the detrimental impact of Babbitt’s crime to the organization and them personally.

Babbitt served as the organization’s national president, from 2000 to 2016, when Babbitt and the charity’s headquarters were in Bloomington, Ill. In that capacity, she controlled the charity’s operations, including its bank accounts. In 2010, Babbitt began using Project Linus credit cards to pay for personal expenses, including clothing, electronics, pet grooming, furniture, tickets for sporting events, and personal travel. Babbitt used the charity’s funds to make credit card payments, and falsely classified the expenditure in the business ledger to hide her personal use of the funds.

In addition, Babbitt filed false and fraudulent personal tax returns with the state of Illinois in which she failed to report the funds she stole from Project Linus.

The Internal Revenue Service, Criminal Investigation Division; the U.S. Postal Inspection Service; the Illinois Department of Revenue; and the Bloomington Police Department conducted the investigation. Supervisory Assistant U.S. Attorney Darilynn J. Knauss represented the government in the case prosecution.

Topic(s): 
Financial Fraud
Tax


TOPICS: Miscellaneous
KEYWORDS: carolbabbitt; illinois; projectlinus

1 posted on 03/07/2021 3:07:15 PM PST by ransomnote
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To: ransomnote

I worked with a woman whose husband was connected with the athletic department of a public university. He was caught embezzling 100s of thousands of dollars. Turns out he’d been fired at a previous job for doing the same thing at a university in another state. Later he was charged for embezzling money from a charity someone put him in charge of.

Never met him, but he must have been able to really spin things.


2 posted on 03/07/2021 3:20:54 PM PST by hanamizu
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To: ransomnote

Thanks for your posts, ransomnote.


3 posted on 03/07/2021 3:22:31 PM PST by PGalt (past peak civilization?)
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To: ransomnote

There seems to be no shortage of these people. I don’t know how they sleep at night.


4 posted on 03/07/2021 3:33:35 PM PST by Paved Paradise
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To: ransomnote
This is why you have audits.

Yearly is best but even every three years is enough to keep most people honest.

Yeah, I know honest people do not require audits, you would not insult them by suggesting they are not honest, how dare I, blah, blah, blah.

Heard it all. Nearly every time I suggest an audit in fact.

Are the people who run charities bad people who will steal money from the mouths of children? Some are. But most are just weak and a bit careless and then astonished at how easy it is to steal.

They use the company card because they don't have quite enough on their debit for something and they really do intend to pay it back but something else crops up and they are really working hard and no one appreciated all they do and before you know it you have a real mess.

Find the first couple of fiddles, make them pay it back and oddly enough they will not try again. At least as long as they know another audit looms.

So... audits.

For your church, your charity, your business and especially for your government.

5 posted on 03/07/2021 3:39:46 PM PST by Harmless Teddy Bear (May their path be strewn with Legos, may they step on them with bare feet until they repent. )
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To: Harmless Teddy Bear
This is why you have audits.

Absolutely, and make sure you hire a different auditing firm every 3-5 years. It keeps everyone on their toes.

I worked in a couple of CPA firms, and performed more than a dozen audits. If you just follow the checklists, you'd catch 95% of most fraud. Any experienced auditor would discover the other 5% IMO.

First and foremost, confirming amounts at financial institutions is imperative. Bank statements can be fabricated using today's technology. A bank confirm serves as independent corroboration.

6 posted on 03/07/2021 3:54:06 PM PST by Night Hides Not (Remember the Alamo! Remember Goliad! Remember Gonzales! Come and Take It!)
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To: ransomnote

Sheesh, who can you trust these days? My little knit/crochet group just donated 35 finished blankets to the local Project Linus group.


7 posted on 03/07/2021 4:14:50 PM PST by RightField
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To: ransomnote

I’ve worked in various accounting positions over the years and I’ve seen it and suspected it.

If you don’t have 6 eyes on the piggy bank, and monthly reconciliation proved and presented to at least 6 more eyeballs, you’re asking for trouble.

Even the best people get tempted and believe they can square things.

Having multiple people watching can save both the money and the person who might take it.


8 posted on 03/07/2021 5:31:53 PM PST by CaptainPhilFan ( )
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To: RightField

My 84 year old Mom did 50 quilts in one year. She’s got a system.


9 posted on 03/07/2021 5:34:48 PM PST by Tijeras_Slim
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To: Paved Paradise

Stealing from a children’s charity is REALLY low.


10 posted on 03/07/2021 6:29:48 PM PST by Amberdawn (Want To Honor Our Troops? Then Be A Citizen Worth Fighting For.)
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To: hanamizu

how about the thug who killed Ashli Babbit? They keep on crowing about the “deadly insurrection” when the ONLY person who was killed was Ashli Babbit. She was murdered by a fed thug.


11 posted on 03/07/2021 10:18:20 PM PST by The Right Edge (Staunch Trump Supporter AND PROUD to be!)
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