Ex-Belfry school clerk withdraws guilty plea after restitution fight in fraud case

The sentencing Wednesday of a former Belfry school clerk who admitted using a school credit card to embezzle money fell apart in a dispute over restitution.

U.S. District Judge Susan Watters rejected a plea agreement between federal prosecutors and the defense and allowed Patricia Ann Webb, 56, of Jordan, Utah, to withdraw her guilty plea.

Webb can go to trial or re-negotiate another plea deal, Watters said.

Prosecutors accused Webb of illegally using a school credit card to embezzle more than $30,000 for personal expenses and of filing false tax returns for 2010 and 2011 by not reporting the stolen money as income.

Webb worked as a clerk from July 2008 until August 2012, when she was placed on leave. She resigned in October 2012.

Webb was indicted on five counts of wire fraud and two counts filing false tax returns. She pleaded guilty in March to one count of filing a false tax return. A plea agreement called for the remaining counts to be dismissed and for Webb to pay restitution.

Wednesday’s hearing was the continuation of an August sentencing hearing in which the parties disputed the restitution.

Assistant Federal Defender Steve Babcock on Wednesday called the prosecution’s position “a blatant breach” of the plea agreement and accused the prosecutor of acting in bad faith.

Babcock further accused the judge of improperly interfering with plea negotiations when Watters earlier said she would reject the plea deal if Webb did not agree to pay $47,700 restitution.

Babcock said Webb upheld her end of the deal by pleading guilty and by agreeing to pay $23,167 restitution, which covered all of the counts.

The prosecution, he argued, was trying to add another $24,000 to the restitution based on pre-sentence report and recommendation from the probation officer. The prosecution knew about the additional $24,000 but did not include it among the charges, Babcock said.

The plea agreement identified $23,167 restitution, with $5,000 to the Belfry School District, $13,783 to National Union Fire Company and $4,384 to the IRS.

The agreement also said Webb would be responsible for “complete restitution” no matter what counts were a part of the charges.

Babcock said the agreement discussed restitution for the charge Webb admitted and for the counts to be dismissed and not any other alleged loss.

Further, Babcock argued that a legal analysis says any ambiguity is to be found in favor of the defendant.

Watters disagreed that she had interjected herself into the plea agreement. Rather, she said, she was trying to understand the agreement’s language and the parties’ positions. There was ambiguity over the agreement’s reference to “complete restitution” and the specific amount of restitution, she said.

Watters did not rule on the question of ambiguity but rejected the entire agreement.

The judge also said the prosecution was not “helping very much” and questioned Assistant U.S. Attorney Chad Spraker about the government’s position.

Spraker said the government believed full restitution included the additional $24,000. The lesser amount identified in the plea agreement, he said, is what the government believed was owed at that time.

After the parties had entered the plea agreement, the victims of Webb’s fraud offered more information to support a total restitution amount of $46,722, Spraker said in a sentencing memo.

Webb, he continued, agreed to make full restitution.

“Perhaps we don’t have a meeting of the minds,” Spraker said.

In sentencing memos, Spraker had recommended Webb get 10 months in prison, while Babcock recommended a probationary sentence.