Stolen funds exceeding $200,000 returned

By DeeAnna Haney | Mar 25, 2014

A Waynesville woman pleaded guilty to embezzling more than $200,000 from the Junaluska Sanitary District while employed there.

Scarlette Heatherly, 49, who worked as the office manager at the sanitary district since October 2006, has since repaid the stolen funds and pleaded guilty to the charges in court Monday.

The embezzlement was discovered during last year's annual audit, one that is required by the N.C. Local Government Commission. On Oct. 23, 2013, an auditor reported to the chairman of the Junaluska Sanitary District board, William Barker, that she had discovered what she suspected was a diversion of funds. Within a few hours, the board held an emergency-called meeting to discuss the issue as a personnel matter.

At the end of the meeting, the board decided to close down all of the computers from any online access as a precautionary measure and the case was turned over to the Haywood County Sheriff's Office immediately.

On Nov. 4, Heatherly made a voluntary appearance to speak with Burt Smith, attorney for the Junaluska Sanitary District, and the auditor. During the meeting, Heatherly admitted she had diverted funds for her own use by manipulating the reporting of cash receipts and deposits into the Junaluska Sanitary District bank deposit accounts.

Over the five-year period, she managed to embezzle about $207,000 from two of the sanitary district bank accounts. According to court documents, she "covered the diversion by making fund transfers from various JSD bank deposit accounts in a manner that she calculated would not be disclosed by the annual audits of the JSD finances."

Heatherly resigned from her job at the sanitary district effective Oct. 25. Court documents note she was the only person involved in the embezzlement.

On Feb. 18, the Junaluska Sanitary District board passed a resolution to accept Heatherly's offer to pay the amount embezzled in addition to other expenses incurred during the investigation, which came to about $224,000.

During the court procedure, Heatherly's attorney, Kirk Kirkpatrick, said the money used to pay the restitution came from the sale of property that belonged to her sister who recently passed away.

Heatherly apologized for her actions in November and then again in court Monday evening, when she pleaded guilty to bills of information charging her with five counts of felony embezzlement — one count for each fiscal year in the case.

Kirkpatrick read two character letters aloud to the court, one from the Rev. Bobby Rogers of Dellwood Baptist Church and another from Neil Carpenter of the Maggie Valley Sanitary District.

Rogers said during the eight years he has known her, she has served the church faithfully as drama director, music director, pianist and on the youth leadership team.

"I would like to give my highest vote of confidence for Scarlette as she continues forward. She has displayed remarkable abilities and will no doubt continue this pattern in the future," he wrote.

Carpenter referred to Heatherly as a dear friend whom he has known for more than 30 years.

"Scarlette Heatherly, in short, is a great person. She is always kind and generous with others and has a strong sense of duty which applies to her job, family and community," he wrote.

Among her mitigating factors, Kirkpatrick pointed out that Heatherly first and foremost made full restitution for the amount embezzled, came forth early in the investigation and apologized for her actions.

Attorney Burt Smith said without Heatherly being up front about her actions, the case would have taken much longer to solve.

"She helped us identify, quantify and rectify the situation," Smith said in court.

For the first two counts of embezzlement, she was given a suspended jail sentence of five to six months each and placed on supervised probation for 24 months. For the last three counts, she was given another suspended jail sentence of five to 15 months each and placed on supervised probation for 24 months.

If she violates her probation, she faces active sentences of a maximum of 57 months behind bars. She must also complete 48 hours of community service.

"Ms. Heatherly is a nice lady and that is shown by the support that she has in the community," Kirkpatrick said. "It is a tribute to her character that she did the right thing as soon as possible."

The Junaluska Sanitary District is ruled by an elected board that includes Barker, Dan McCracken and Jim Francis.

Comments (1)
Posted by: Scott Lilly | Mar 25, 2014 19:31

This woman stole public funds.  She came clean, paid it back, and served time.  She has respected people in the community that will vouch for her character.  She will earn restitution.


Contrast that with someone who cheats to get disability payments from public funds.  Or that only works for cash so as not to interrupt unemployment payments from public funds.  It's a shame we can't penalize those that cheat and steal from public funds with equal punishment.  Too many people consider cheating and stealing from public funds as "acceptable".

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