SPOKANE, Wash – The woman who handled financial affairs for a Spokane non-profit faces federal criminal charges for stealing and not paying taxes to the government.
A federal grand jury indicted Mary Ellen Smith for federal program theft and failure to pay employment taxes.
She was the administrative director of the Guardians Foundation.
The City of Spokane contracted with Guardians Foundation to operate the Cannon Street and Trent Avenue shelters in 2021 and 2022.
The CEO of the group notified the city when funds turned up missing, triggering the city to end the contract with the group and order an investigation.
The grand jury indictment says the City of Spokane received federal grants and paid that money to the Guardians Foundation.
The city paid more than $1,700,000 in 2021 and more than $1,900,000 in 2022.
The indictment says the foundation collected taxes from employee paychecks that it was supposed to then pay to the IRS. It did not do so.
The charges say over two and a half years, Smith failed to pay $422,000 in employment taxes.
The indictment also says Smith embezzled more than $49,000 by moving money from Guardians accounts to PayPal accounts she controlled, “issuing herself additional checks, including payroll checks outside of the pay period, and paying personal expenses out of the Guardians bank account.”
If convicted, Smith faces up to 10 years in federal prison and a fine up to $250,000.
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