Wisconsin addiction center $770K embezzlement; 2 get prison time

Two employees of a Native American addiction and counseling center, including its executive director, have been sentenced on charges of embezzling more than $777,000 in federal funds.

Federal officials in Wisconsin say Fredericka DeCoteau, 63, of Cloquet, Minnesota, was sentenced Friday to 2 years in prison and Edith Schmuck, 77, of Rice Lake, Wisconsin, was sentenced to 1 year and 1 day in prison.

They were charged with theft of federal program funds. U.S. District Judge William M. Conley ordered DeCoteau and Schmuck to jointly back restitution of $777,283.

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DeCoteau and Schmuck worked at Ain Dah Ing, which has operated as a non-profit halfway house in Spooner, Wisconsin since 1971. DeCoteau was the executive director from 2002 to 2017. Schmuck was the bookkeeper from 1990 to 2017.

The center offers mental health and alcohol and substance abuse services to Native Americans from Michigan, Minnesota, and Wisconsin tribes. Its funding came from a federal commercial contract with the U.S. Department of Health and Human Services.

The complaint said DeCoteau and Schmuck paid themselves unauthorized bonuses via payroll checks that were signed using a rubber signature stamp of the center's treasurer. The judge said they lost most of the money at local American Indian casinos.

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