Sunday afternoon matinee: What do Dixon, Illinois, Front Royal and Warren County have in common?

A sizeable crowd gathered Sunday afternoon at 2 p.m. at the Villa Avenue Community Center for a viewing of the documentary film “All The Queen’s Horses”. The film about a city financial official in Dixon, Illinois, who is currently serving a nearly 20-year prison sentence for embezzling $53.7 million dollars over a 20-year period, seems to be of particular interest locally due to our own developing municipal-EDA financial scandal.

Melanie Salins, who was instrumental in bringing filmmaker here, introduces Producer-Director Pope to Sunday audience for her film on small-town municipal embezzlement. Royal Examiner Photos/Roger Bianchini

Rita Crundwell was arrested by the FBI in 2012 on what is to date the largest municipal embezzlement in U.S. history. Film producer/director and public accounting professor at DePaul University Kelly Richmond Pope was present to introduce her film and do a post-viewing question-and-answer session centered around what similarities she does or doesn’t see between the Dixon, Illinois situation and Front Royal and Warren County’s Economic Development Authority financial scandal.

And based on what she heard in questioning or perceptions from locals, as well as what she may know about the 15-defendant EDA civil suit and related criminal charges against multiple defendants surrounding principal defendant and former EDA Executive Director Jennifer McDonald, Pope said the local situation may be more similar to the one Dixon dethroned as the largest U.S. municipal embezzlement scandal, a $48 million dollar one in Washington, D.C.

That similarity is based on the fact that the evidence assembled indicated that Dixon Comptroller, or Chief Financial Officer, Crundwell is believed to have acted alone, whereas the D.C. situation involved multiple people.

Kelly R. Pope gives some pre-viewing background to her documentary ‘All The Queen’s Horses’ on a $53.7-million municipal embezzlement in Dixon, Illinois.

Yes, Pope told the local audience, Crundwell’s family members did benefit from her spreading her wealth around, but no hard evidence was produced that any were legally complicit in Crundwell’s crimes. Of course, those charged civilly or criminally here have yet to have their day in court to contest the allegations against them.

If locally McDonald spread the story that her high cash flow was based on an improbable three-year run of luck on the slot machines at Charles Town, West Virginia’s Hollywood Casino, Crundwell had a variety of “rumors” floating to cover her family generosity and high-dollar quarter horse stable operation. Among those were an inheritance from rich, former boyfriend who passed away years earlier; and high-dollar horse sales from her high-profile, 400-quarter and show horse operation that took her around the country.

But nearly $54 million dollars out of a small city of around 16,000 residents’ annual budget for so many years – the question lay heavy on that community as a similar one now does on ours: “How did a high-school educated municipal clerk pull it off?”

Well, Crundwell was an attractive, gregarious, well-though-of local girl the community was proud of, and upon which the city’s mayor and council relied heavily on to conduct Dixon’s financial operations.

“It’s human nature to trust them,” one Dixon resident told Pope’s documentary camera of the local girl making good in an $80,000 a year city position.

The Sunday Matinee crowd awaits the film’s introduction and showing

Another question asked was how could so much money be removed from a small city budget over such a long period of time without somebody noticing?

Well, someone did notice – a municipal financial official from a neighboring city, Sterling, Illinois. In fact, the Sterling official wrote to Dixon officials citing the similarity in the two cities’ annual operational budgets, citing a RED FLAG in that while Sterling carried a surplus, Dixon carried a “huge” deficit of around $20 million. However, that warning was filed away without action, as the rationale that Dixon was doing a lot of borrowing at the time was self-generated to explain the difference.

Another factor in how it happened to Dixon was cited as its “Commissioner” form of government, which essentially does not carry multiple administrative and financial staff positions. Dixon’s staff was small with no direct oversight of Crundwell’s activities, other than by a poorly-paid, part-time elected council and mayor.

“Rita was the checks and balances,” one person told the documentary camera.

So, when she added seven bank accounts to facilitate her fraud to the City’s six legitimate bank accounts, no one noticed – for a long time.

Dixon, Illinois City Comptroller Rita Crundwell supported a 400-horse stable of quarter and show horses with a significant portion of the nearly $54 million she embezzled over a 20-year period, hence the film’s title.

However in November of 2012, after finally-alerted Dixon municipal officials notified the FBI of possible financial crimes in their midst, Crundwell eventually pled guilty to federal money laundering and wire fraud charges. The 19-year-and-7-month sentence handed down was above guidelines and near the maximum 20 years she faced. Crundwell is scheduled for release from prison on March 5, 2030.

And much as locally here, as McDonald’s alleged embezzlement schemes were uncovered essentially by accident when Front Royal Finance Director B. J. Wilson was asked by his elected council to find a way to make a half-million dollar, interest-free internal loan to fund a new town police radio system; in Dixon a Crundwell assistant Kathe Swanson uncovered some questionable financial transactions while covering for Crundwell during an absence from the office. It is noted in the film that Crundwell took four months a year off, apparently to take care of her horse operation, and maybe to spend some of her embezzled funds on some additional personal expenses.

Above, a blurry shot of Rita Crundwell, cowboy hat, from a showing of ‘All The Queen’s Horses’ in her auctioned-off home in Dixon; below, ‘We all have one,’ says film director Kelly Richmond Pope of that person all trust without question. In addition to her foray into documentary filmmaking, Pope is a professor of accounting at DePaul University. Her film is available on various streaming TV-movie sites.

And while it took a while to get to it in the film, once uncovered and successfully prosecuted, public outrage targeting Dixon’s elected officials saw a total turnover of the city’s elected leadership.

Towards the end of her Q & A with the audience, which included Mark Egger’s recounting of his daughter’s experience of outright vilification at times in trying to raise questions about EDA operations and projects while on the Front Royal Town Council in 2016-17, and other audience assertions of municipal and even law enforcement cover ups, filmmaker Pope told the crowd she might well return to explore the local dynamics of this community’s unfolding experience.

One interested observer of Sunday’s matinee was New York Times reporter Abbey Ellin, who apparently hooked up with Pope at the airport on the way into Front Royal. In fact, as the Q & A was breaking up around 5 p.m. from the 2 p.m. showing, Ellin was being maneuvered toward the airport return trip with the filmmaker by local transport service operator Michael Williams to assure Pope did not miss her return flight out of the D.C. area.

So, as the involved numbers of sought assets for recovery climb, along with the number of both civil and criminal defendants, along with conspiracy theories about how it happened, it seems national interest in Front Royal and Warren County’s slice of what Pope described as a $3.7-trillion-dollar national embezzlement problem is rising as well.

Looks like us local first chroniclers of our town and county histories better get cracking on those side projects …