Michigan county out 1.2 million after treasurer falls for Nigerian email scam

County may be out $1.2 mil. in e-mail scam
Mich. officials say treasurer fell for Nigerian fraud
January 19, 2007
BY DAWSON BELL

The longtime treasurer of Alcona County, Mich., has been accused in an embezzlement scheme in which he may have served as both perpetrator and victim, sending up to $1.25 million in county funds and his own life savings to con artists after falling for one of the notorious online Nigerian banking frauds.

Thomas Katona, 56, of Harrisville, Mich., was charged Wednesday with nine felonies, including embezzlement and fraud, after a monthlong investigation by state authorities of numerous unauthorized wire transfers he allegedly made of county funds to overseas bank accounts.

13 years on the job

The accounts were allegedly controlled by operators of a Nigerian advance fee fraud, law enforcement officials said.

Katona had been treasurer for Alcona County, along Lake Huron in the northern Lower Peninsula, for 13 years. He was relieved of his job in late November, after the alleged fraud was uncovered.

The county, with only about 11,000 residents, has a total budget of about $4 million.

Court documents said that in August and September, Katona made at least eight unauthorized wire transfers totaling $186,500. Earlier in the year, he sent at least $72,500 of his own money to the same accounts, the documents said.

Bank issued warning

County officials learned of the unauthorized transfers when Katona was in London, apparently to meet with some of his contacts, and bank records were faxed to county offices. Local bank officials had warned Katona that they suspected he was dealing with Nigerian fraud artists, according to the documents.

A preliminary audit, which turned up an additional forged document, indicates a shortfall of $1,236,700. It was unclear how much of the missing money was invested in the scheme, officials said.

'What was he thinking?'

A spokesman for Michigan Attorney General Mike Cox said efforts are under way to track the money and the con artists behind the scheme -- variations of which have been on the Internet for a decade. Investigators doubt any money will recovered, spokesman Matt Frendeway said.

''Every part of this makes you wonder, 'What was he thinking?'' Frendeway said.

Katona was not represented by an attorney at his arraignment in 81st District Court and could not be reached for comment Wednesday evening. He is scheduled for a preliminary hearing Jan. 31.

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