Peggy Kempton, a former Harvard resident and former chief financial officer and deputy director of Fruitlands Museum, was sentenced Monday in Worcester Superior Court to serve three to five years in state prison, followed by 10 years of probation, in connection with the embezzlement of more than $1.3 million from the museum.
Judge Richard T. Tucker ordered that Kempton make full restitution to the museum in the amount of $1.3 million and ordered that when she is on probation, Kempton must avoid all contact with Fruitlands and must notify future employers of her conviction.
In September 2008 the attorney general’s office began an investigation of Kempton in response to a complaint filed by Fruitlands, which alleged that Kempton “embarked upon an embezzlement scheme in which she opened numerous credit accounts with various entities, obtained credit cards in her own name and in the name of Fruitlands, and began making various personal charges wholly unrelated to Fruitlands’ business activities and then paying these personal charges with Fruitlands’ funds.” The complaint was filed after Kempton resigned unexpectedly in February 2008 and several financial discrepancies were noticed, prompting the museum to hire a forensic audit team to investigate.
The criminal case was investigated by financial investigators Jessie Dean and Jim McFadden of the Financial Investigations Division, and Massachusetts State Police assigned to the Attorney General’s Office. The investigation revealed that between January 2002 and February 2008 Kempton stole funds from Fruitlands to pay for more than $1.3 million in personal purchases that she and her children made using 14 different credit cards. One of the credit cards was in the name of a co-worker who had no knowledge that the card existed and was being used by Kempton.
Kempton also used “cash advance checks” from credit cards in the names of three co-workers to pay for personal purchases that Kempton made on her own credit cards. Kempton did this without the knowledge or authorization of the co-workers. Investigators also discovered that Kempton manipulated the financial records to make it appear that the Fruitlands funds that she used to pay for personal purchases and other expenses were being used for legitimate expenses.
A Worcester County Grand Jury returned indictments against Kempton on June 19, 2009. At that time the indictments were sealed, and a warrant was issued for Kempton’s arrest. Kempton surrendered herself to authorities on June 23, 2009, and was arraigned in Worcester Superior Court, where she pled not guilty and was subsequently released on $5,000 cash bail.
On May 5, 2010, Kempton pled guilty to all charges, which included Larceny over $250 by Single Scheme (14 Counts), Fraudulent Use of Credit Cards (3 counts), and False Entries in Corporate Books.
In a press release issued this week, Attorney General Martha Coakley said, “This defendant abused her position of trust to defraud her employers and misuse charitable funds for her own personal gain. With today’s sentence she has been held accountable for her actions.”