How a bookkeeper allegedly stole $682,000 over 5 years

MINNEAPOLIS (KMSP) - The former bookkeeper of a Minnetonka medical device company is accused of stealing nearly $700,000 to give herself vacations, clothing, silver bars and cash. Karen Jane Breyette, 53, is charged with 7 counts of theft-by-swindle for allegedly stealing $682,881 from PenRad Technologies.

Investigators believe the amount Breyette embezzled from PenRad is closer to $900,000, but she was so successful in concealing her thefts that she wasn’t caught until May 2015. Because of this delay, thefts that occurred in 2008, 2009 and early 2010 are outside the statute of limitations and not included in these charges.

Payroll theft

Abuse of the payroll system Breyette controlled was the largest source of theft. She allegedly arranged for overpayments of her salary and “quarterly commission payments” to herself and her husband. In 2011 and 2012 the thefts stopped, and she made an apparent attempt to repay the company by skipping her own salary payments, but failed to balance out her thefts.

According to the criminal complaint, “her choice to overpay herself in years prior was a theft by swindle, and indeed her choosing to forgo pay is in essence an admission that she had previously stolen from her employer.”

From 2008 to 2012, Breyette allegedly stole $185,830 from PenRad via the payroll system. She resumed stealing from the company in 2013 with overpayments of $167,424, followed by $205,165 in 2014 and $105,509 in the first 5 months of 2015.

Abuse of company credit card

At the same time she was overpaying herself through the company payroll system, Breyette was allegedly using the PenRad corporate credit card for personal purchases. The pattern of theft started in June 2008, just 6 months after she was hired, with small purchases at a local gas station. The flagrancy of her fraudulent purchases increased over time, with $6,500 spent on hotel rooms in December 2011 and more than $24,000 for a spring break vacation with her mother in March 2013.

Forged checks

On at least 5 occasions, Breyette is accused of cutting checks from the company account and forging the signature of the company president. Three of the checks, each for about $4,000, were written out to Karen Breyette. A fourth check was written to Independent Living Bouillon to purchase $6,830 in silver bars, which were later recovered from Breyette’s home in St. Bonifacius.

Wire transfers

Breyette arranged for at least 3 fraudulent wire transfers totaling $74,000. Two of the transfers, totaling $42,000, were sent to the accounts of Gentle Green Cleaners, of which she was a part owner. The third transfer was sent to a personal bank account in Macomb, Mich., but Breyette will not reveal who received that money.

Karen Breyette is scheduled to make her first court appearance Sept. 1 in Hennepin County. The case was investigated by Minnetonka police because the company was located there until moving to Buffalo, Minn. in Wright County in 2012.