In 1991, Dixon, Illinois Comptroller and Treasurer Rita Crundwell began stealing city funds to finance her show-horse breeding empire, allowing her hometown to fall into a state of financial crisis while she lived a lavish lifestyle.
Public DomainRita Crundwell stole millions of dollars from her own hometown while serving as the city’s Comptroller and Treasurer.
Rita Crundwell seemed to have it made in life. While working as the Comptroller and Treasurer of Dixon, Illinois, she also ran a multimillion-dollar horse breeding and showing business, securing dozens of Oklahoma City world championships with her 400 show horses.
Despite making just $80,000 a year in her city government role, Crundwell had fancy cars, a vacation home in Florida, expensive jewelry, and state-of-the-art facilities for her horses. For years, her neighbors assumed her wealth came from her horse breeding business, or that she’d inherited a fortune from a relative.
In reality, she was embezzling millions from her own hometown to fund her extravagant lifestyle.
In 1991, Rita Crundwell began writing fake invoices to transfer massive amounts of money from city accounts to her own secret bank account. By the time she was finally arrested in 2012, she had stolen over $53 million from the town of Dixon in what is considered the largest case of municipal fraud in U.S. history.
The Makings Of A Fraudster
Dixon Public LibraryIn high school, Rita Crundwell was a popular student who graduated near the top of her class.
Born in 1953, Rita Crundwell was raised on a farm near Dixon, Illinois, where she grew up surrounded by animals. Her mother had a passion for showing quarter horses — a passion that apparently rubbed off on Crundwell.
While attending Dixon High School, Crundwell made the honor roll and was generally considered a bright, diligent student. According to the Sauk Valley News, she was well-liked among her peers and even earned a spot in the homecoming court.
In 1970, she began working for Dixon City Hall via a work-study program. After she graduated the following year, she took on a permanent position working for the City as secretary to the mayor.
By 1978, she had begun to pursue her true passion: breeding and showing quarter horses. Initially, Crundwell owned just three horses and competed in regional competitions rather than national ones.
Despite her fairly modest upbringing, Crundwell had a taste for the finer things in life. She enjoyed expensive clothes, jewelry, fancy cars, and show horses. The only problem? Her source of income.
Then, in 1983, Crundwell was appointed Comptroller and Treasurer of Dixon, leaving her with virtually complete control of the town’s finances. She would stay in this role for three decades, using her influence to pull off the most lucrative municipal fraud scheme in United States history.
Rita Crundwell Begins Stealing From Dixon
In December 1990, Rita Crundwell secretly opened a bank account she called “RSCDA-Reserve Fund,” which stood for “Reserve Sewer Capital Development Account.” To a casual observer, this might have looked like an official City account. In reality, Crundwell was using it to make personal purchases.
In 1991, Crundwell began to transfer money from legitimate City accounts to the RSCDA-Reserve Fund by writing fake invoices. In 1991, she transferred over $180,000. Over the next two decades, she gradually stole more and more in city funds, averaging roughly $2.5 million a year. In 2008, amid the global economic crisis, she stole a whopping $5.8 million.
Despite making only $80,000 annually as the Comptroller and Treasurer of Dixon, Crundwell was able to purchase a second home in Florida, expensive clothing and jewelry, 80 acres of vacant land, a 2009 luxury motor home, four dozen trucks, a 2005 Ford Thunderbird convertible, a 1967 Chevrolet Corvette roadster, and a pontoon boat.
She also used the money to build her multimillion-dollar horse breeding empire, with over 400 horses, a 20,000-square-foot barn and showing arena, and several 10-horse trailers outfitted with standup showers and flat-screen TVs.
Kartemquin FilmsRita Crundwell ran an award-winning horse breeding operation, largely funded by money she stole from the city of Dixon.
Meanwhile, Crundwell approved budget cuts for various city departments, allowing the town to gradually fall into a state of disrepair and financial crisis. To cover up her crimes, Crundwell blamed the economic recession and delayed payments from the State. And for about two decades, she got away with it.
Many of her coworkers assumed that her show-horse breeding business was lucrative enough to support her lavish lifestyle. Others suspected that she had simply been born into wealth.
“I knew she worked for the city in Dixon, so I kind of wondered,” Debby Brehm, a horse owner from Nebraska who competed against Crundwell in horse competitions, told Chicago magazine in 2012. “But the story I heard was there was something from her past, where she had inherited land in the Chicago area, so I never thought anything of it.”
The Biggest Municipal Fraud Case In U.S. History Is Revealed
GoHorseShowRita Crundwell (right) at her 57th birthday party in Florida.
For years, Rita Crundwell benefited from a lack of proper oversight in Dixon’s City Hall. Dixon was a small town with limited resources. In fact, the financial commissioner who was supposed to oversee Crundwell worked part time and made only $2,700 a year; it’s likely he did not spend much time looking over the City’s budget.
What’s more, Crundwell had a reputation for being meticulous and honest in her work, so Dixon officials trusted her to handle the books almost entirely on her own. Even the city’s auditors failed to detect fraud in Dixon’s financial statements over the years.
But Crundwell couldn’t keep her crimes hidden forever.
In 2011, while Crundwell was away on vacation, the city’s temporary comptroller asked the bank to see all of the accounts under the city’s name. It didn’t take long for her to discover the “RSCDA-Reserve Fund” account.
After realizing that funds from this account were being used to purchase things like horses and jewelry, the temporary comptroller alerted the city’s mayor, Jim Burke, who contacted the FBI.
For nearly half a year, the FBI secretly monitored Crundwell’s activities, watching as she continued to deposit money into the secret account. Finally, on April 17, 2012, FBI agents showed up at Dixon City Hall and arrested Rita Crundwell for embezzlement.
By that point, she had stolen over $53 million from her own town.
Life After Fraud: Where Is Rita Crundwell Now?
Kartemquin FilmsThe story of Rita Crundwell’s crimes was explored in the 2017 documentary All the Queen’s Horses.
On Nov. 14, 2012, Rita Crundwell pleaded guilty to wire fraud and money laundering. As part of her plea deal, Crundwell forfeited her assets, including about 400 horses. The judge required Crundwell to pay full restitution to the city of Dixon. As of 2020, the town has recovered about $40 million of the stolen funds.
At her sentencing hearing, it was also revealed that between 1988 and 1990, even before Crundwell’s massive fraud scheme began, she had stolen $25,000 from another Dixon bank account for its “Sister City” program.
“This has been a massive stealing of public money — monies entrusted to you as a public guardian of Dixon, Illinois,” Judge Philip G. Reinhard told Crundwell during her sentencing, according to the FBI. Judge Reinhard added that Crundwell showed “greater passion for the welfare of her horses than the people of Dixon who she represented.”
In 2013, Crundwell was sentenced to 19 years and seven months behind bars and sent to a minimum security prison in Minnesota. However, she only served about eight years before she was granted home confinement on her brother’s farm in Dixon in August 2021. She is scheduled to be released from home confinement on Oct. 20, 2029.
For the residents of Dixon, Rita Crundwell’s story serves as a cruel reminder of how damaging one person’s actions can be. Crundwell’s scheme put the city in dire financial straits — a place it’s still working to get out of today.
“We have used criminal and civil forfeiture proceedings to ensure the recovery of as much money as possible for the city of Dixon and its taxpayers,” stated Gary S. Shapiro, United States Attorney for the Northern District of Illinois, according to the FBI. “Unfortunately, this case serves as a painful lesson that trust, without verification, can lead to betrayal.”
After reading about Rita Crundwell, dive into the stories of nine of history’s biggest con artists. Then, read about the schemes of Charles Ponzi and why his name is synonymous with swindling.
