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Story Last modified at 8:30 p.m. on Wednesday, April 20, 2011

Accused church embezzler behind bars
Bussey doing 'shock time' at Hiland in plea deal; judge to decide money owed

Alaska Star

The former employee accused of embezzling nearly $40,000 from Eagle River's St. Andrew Catholic Church is spending the next three months at Hiland Mountain Correctional Center.

Former Eagle River resident Cathy Bussey pleaded guilty to first-degree theft during a change-of-plea hearing in Anchorage Superior Court on April 14, a prosecutor said.

Bussey was jailed immediately after the hearing ended, assistant district attorney Andrew Grannik said. She is scheduled for release on June 4.

Along with what Grannik called the "shock time" of the 90-day sentence, Judge Beverly Cutler sentenced Bussey to four years suspended.

Bussey is accused of embezzling the money through a combination of direct deposits and false invoices.

A judge will decide what, if any, restitution Bussey owes the church at a July hearing.

Grannik declined to say how much restitution the state will ask for.

"We want her to eventually pay the money back," he said. "The judge will decide how much money she owes. We don't want to interfere in that."

First-degree theft is a felony that can bring a jail sentence as high as 10 years, though sentences vary, and depend on factors such as prior history. Had the case gone to trial, she would have faced 17 separate counts of second-degree theft reflecting individual dates from October 2008 through May 2009.

Bussey, contacted by cell phone in Michigan last month, said she wanted to be able to tell her side of the story but couldn't comment because of the ongoing court case.

A representative of the church did not immediately respond to a request for comment.

The church first reported "fraudulent account activity by their part-time employee" in May 2009, according to an Anchorage Police Department probable cause statement filed in Anchorage Superior Court in December 2010.

The accounting office for the Archdiocese had been asking Bussey for finance reports but she put them off, saying, "I can't do it, don't have the right update," according to the statement filed by police Det. Joseph Barth. The office discovered the discrepancies after making a backup copy of the records in March 2009.

A church CPA told police that Bussey redirected $27,630.87 into her personal bank account using a direct-deposit payroll system. Bussey also created a false invoice for landscaping work being done around the church, according to the court document. The invoice showed the church purchasing $9,800 worth of landscaping materials from Planet Hospital, a medical travel agency in California. The CPA discovered that Bussey used the $9,800 check to pay for a planned medical procedure, but later cancelled the procedure for a refund.

Police arrested Bussey in December 2009. At that time, she was charged with scheming to defraud, first-degree theft and falsifying business records, all felonies. Bussey entered a not-guilty plea in December and was released on a $10,000 bond.

Bussey had been convicted of theft in a 2003 case and has several bankruptcy cases in various states, according to Barth. While she has "residence history" in Arkansas, Michigan, California and Nevada, she apparently owns no property.

Anchorage Superior Court Judge Nancy Nolan dismissed the case against Bussey in February 2010. Due to problems with witness availability, prosecutors could not get the case before a grand jury within 20 days as required.

But prosecutors reopened the case against Bussey in March 2010 and a grand jury indicted her on multiple felony charges including scheming to defraud, falsifying business records, forgery and theft.

Father Steven Moore, the church's pastoral administrator, said at the time that the church changed its accounting policies in light of the case. Now, three different people handle the books.

This article published in The Alaska Star on Wednesday, April 20, 2011.