NEWPORT-The former executive director of Community House Cooperative will serve three years in the Community Corrections Program, pay a $1,000 fine, and make restitution to the community service organization after pleading guilty in an embezzlement case this week in Cocke County Circuit Court.
Karen Kathleen Neef, 38, of 1344 Bluff Road, pled guilty this week to one count of theft of property valued at more than $10,000. As part of the negotiated plea agreement, Neef was sentenced to three years in jail, reduced to time served, with the balance in Community Corrections. In addition to the fine and restitution, Neef was also ordered to perform 100 hours of community service work.
Neef is accused of embezzling an estimated $50,000 from the local community service organization, Newport police reported at the time of her arrest last September.
Circuit Judge Ben W. Hooper II will conduct a hearing later on the exact amount of restitution the defendant will be required to pay as part of her plea agreement.
The indictment against Neef alleges that she took between $10,000 and $60,000 from Community House Cooperative (CHC) between June 2007 and September 2008.
According to a Newport Police Department report filed at the time of her arrest in September, Neef was administrator in charge of grants and federal funds for CHC and had been employed there for about six years. As executive director and bookkeeper for the organization, she is alleged to have used its bank accounts to pay her personal bills and credit card payments and to have deposited the organization's checks into her personal bank account between June 2007 and September 2008. Local police were first contacted about the alleged embezzlement on September 9, 2008.
According to its web site, CHC, which is located in the Tanner Building at 115 Mulberry Street, was incorporated in 1995 by a small group of women to support the Cocke County community "through establishing effective projects, inclusive process, and sustainable programs that further social, economic, and environmental justice."
Police were reportedly told in September that Neef abruptly turned in a letter of resignation without returning for her personal belongings.
CHC officials told investigators that Neef became solely responsible for the organization's bookkeeping in May of last year and she is alleged to have started using the organization's funds for personal expenses soon after that date.
Community House representative Terry Cutshaw reportedly told police that the organization began investigating the alleged embezzlement after it received reports from its bank that its accounts were overdrawn and discovering that services such as telephone service were being terminated for non-payment of monthly bills.
After reviewing the organization's bank records, CHC officials also discovered that Neef was allegedly writing checks from the organization to herself and depositing the funds into her personal bank account, Cutshaw reportedly told police. Neef is also accused of making personal purchases and paying for them from the organization's checking account and credit card.
She is also accused of writing several checks for the same purchases and having different CHC board members sign the checks.
In another plea-bargain announced this week in criminal court, 26-year-old Richard Carnal, of Solitary Way, Bybee, entered guilty pleas to two indictments.
In the first case, Carnal pled guilty to theft of property valued at more than $1,000 and arson of the property of another. He received concurrent three-year sentences in the case. Those terms will be served consecutively with sentences in two other cases against the defendant in criminal court, under the terms of the plea agreement.
Carnal and co-defendant Matthew L. McGaha, 20, are alleged to have stolen a Toyota pickup belonging to Tommy Golman, of 351 Shawnee Avenue, from its trailer on August 30 of last year. After the pair went "four-wheeling" in the vehicle, they set fire to the truck and destroyed it, Assistant District Attorney General Brownlow Marsh told the court.
In the second case, Carnal entered a guilty plea to theft of property valued at less than $500 in connection with the theft of merchandise belonging to the Newport Wal-Mart last year.
The defendant received a concurrent 11-month, 29-day jail term in the second theft case.
Judge Hooper will conduct a sentencing hearing later to determine the details of how the sentences will be served.