Reno man convicted of defrauding government of $200K
March 24, 2014
RENO — A Reno businessman was convicted Monday of defrauding the U.S. government out of $200,000 in grants from a faith-based initiative that was supposed to have been spent on charities.
A federal jury deliberated for about two hours Monday afternoon before finding Michael Stickler guilty of a single count of theft of government property.
Stickler shook his head slightly but otherwise showed no emotion when the clerk read the verdict.
U.S. District Judge Miranda Du set sentencing for June 30 and agreed to allow Stickler to remain free until that time. He faces a maximum up to 10 years in prison, but his lawyers said he’s likely looking at closer to two to three years.
Stickler obtained the money with a grant for his Faith Based Solutions LLC during 2007-08 through the faith-based program at the U.S. Department of Health and Human Services. Among other things, prosecutors said he spent $13,000 on a monthlong Hawaiian vacation.
Stickler testified that his bookkeeper, Katie Petri, embezzled the money. But Petri, who faces no criminal charges and was granted immunity to testify in the case, that Stickler was lying and that he directed her to spend the money on his behalf.
“It comes down to who are you going to believe?” Assistant U.S. Attorney Ron Rachow told the jurors in closing arguments. “The only one who benefited from the misuse of government funds is Mr. Stickler.”
Assistant U.S. Attorney Carla Higginbotham said it didn’t make sense that Stickler wouldn’t know Petri was transferring money back and forth between the grant fund and other Faith Based Solution funds, as Stickler claims.
“This isn’t Microsoft or Google or General Motors. This is a family business with 10 or 12 employees,” she said.
Lauren Gorman, one of Stickler’s public defenders, said Petri was the business manager and account manager for Faith Based Solutions and that Stickler left the finances in her hands because he trusted her.
She also had a combined 23 years of experience in accounting and bookkeeping.
“She was an operations manager for Wells Fargo. She knew her way around money,” she told the jury. “I ask you not to swallow the government’s story that she was ‘just the bookkeeper,’ that she was just taking orders.”
Gorman said Petri agreed to testify against her former boss only after the government granted her immunity.
“She stole, she lied, she stood up to the U.S. government and she is walking out of this case unscathed,” she said.
In addition to the Hawaii vacation, prosecutors said Stickler spent money on such things as 1-800-Flowers, Babies R Us, a Reno dry cleaners and Starbucks.
Stickler also was indicted in March 2013 on charges that he withdrew federal taxes from his Faith Based Solutions employee paychecks from 2007-10, but failed to send the funds to the IRS. He has pleaded not guilty to that charge. That trial is set for June 3.