Two nuns accused of embezzling $500K from school for trips and gambling

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By Minyvonne Burke

Two Catholic school nuns accused of embezzling about a half-million dollars in tuition, fees and donations from a school allegedly used some of the money to gamble in Las Vegas, according to officials cited in a news report.

On Monday night, the Archdiocese of Los Angeles told parents and alumni at a meeting that Sisters Mary Margaret Kreuper and Lana Chang, described as best friends, took around $500,000 from St. James Catholic School in Torrance, according to an audio recording of the meeting obtained by the Press-Telegram.

Kreuper was principal at the school for 29 years. Chang was a teacher for about 20 years and also recently served as vice principal. They both retired at the end of this past school year, shortly before St. James Catholic Church in Redondo Beach was made aware of the alleged embezzlement happening at its school.

Officials with the archdiocese alleged the nuns spent some of the money on personal trips and gambling, the Press-Telegram reported.

“We do know that they had a pattern of going on trips. We do know they had a pattern of going to casinos, and the reality is, they used the account as their personal account,” an attorney told the crowd at the meeting.

The archdiocese did not immediately respond to NBC News’ request for comment.

Auditors at the meeting said that checks made out to the school for tuition and other fees first went to Kreuper before being handed over to the bookkeeping staff. Kreuper allegedly held on to some of the checks and deposited them into a separate bank account than the one used by the school. Officials said she would alter the checks by endorsing them with a stamp that read “St. James Convent” instead of “St. James School.”

Officials said Kreuper and Chang used a large portion of the stolen funds for “personal gains” and “recycled” some of it back into the school, the Press-Telegram reported.

A bookkeeper who knew about the nuns’ scheme voluntarily took a leave of absence during the investigation, Michael Meyers, the church’s monsignor, said during the meeting, according to the Press-Telegram.

According to Meyers, Kreuper and Chang were able to get away with the alleged scheme for years because the school was profitable and the money the sisters took would have ended up in a reserve fund.

“The systems that were set up were dividing people, so nobody knew what was happening,” he said at the meeting.

The church was made aware of the scheme around June when it began a routine audit in response to Kreuper’s retiring. Meyers said during the meeting that around that same time a family who gave money to the school requested a copy of the check, and staff noticed that the check had been deposited into an account not associated with the school.

Meyers also said at the meeting that Kreuper began displaying “very nervous and very anxious” behavior about the audit and allegedly asked staff to change records. Meyers said he then notified the Archdiocese of Los Angeles, who in turn hired an independent forensic auditor to perform a review.

“Sister Mary Margaret and Sister Lana have expressed to me and asked that I convey to you, the deep remorse they each feel for their actions and ask for your forgiveness and prayers,” Meyers said in a Nov. 28 letter to parents.

“They and their Order pray that you have not lost trust or faith in the educators and administrators of the school. Let us pray for our school families and for Sister Mary Margaret and Sister Lana,” he added.

Viveca Tokatlian, whose son is now a senior at the University of San Diego and was once student in Chang’s eighth-grade class, said she was shocked and disappointed by the news.

“They were just such staunch defenders of moral fortitude, they were really tough on the kids,” she said.

Church officials previously said they did not want to press criminal charges against the nuns. Police will, however, still follow the case and present their findings to the Los Angeles County District Attorney’s Office.

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