DOJ: North Idaho Woman Sentenced to 33 Months in Prison for Wire Fraud After Stealing Over One Million Dollars from Former Employer

• Shafer used fraudulent schemes including inflating paychecks and redirecting vendor payments to her own accounts.
• She was ordered to pay $1,040,126.27 in restitution and spend three years on supervised release after prison.

Tahnya Hyung Shafer, a human resources manager in Spokane Valley, Washington, stole over one million dollars from her employer over two years by inflating her paychecks and redirecting vendor payments to her own bank accounts. Most of the stolen funds were spent at casinos in North Idaho.

As a result of Shafer's actions, the employer fell behind on bills and the owners had to use their own funds to pay employees. Shafer was sentenced to 33 months in federal prison, ordered to pay $1,040,126.27 in restitution, and will be on supervised release for three years.

• 33 months prison sentence for wire fraud
• $1,040,126.27 restitution ordered to former employer

• Review payroll and accounts payable controls for vulnerabilities to schemes like inflating paychecks and redirecting vendor payments.
• Monitor employee access to financial systems, especially those overseeing benefits, payroll, and accounts payable, as highlighted in the DOJ case.
• Update casino-related transaction monitoring to flag large expenditures by employees with access to company funds, referencing the typology in this story.

This case highlights the risks posed by employees with access to payroll and accounts payable systems, especially in small businesses. Fraudulent schemes such as inflating paychecks and redirecting vendor payments can result in significant financial losses and operational disruption. Compliance officers must ensure robust internal controls and transaction monitoring to detect and prevent similar insider fraud, particularly when funds are spent at high-risk venues like casinos. The restitution and sentencing underscore the legal consequences for such offenses.