The Joplin Globe, Joplin, MO

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August 2, 2012

Joplin businesswoman sentenced to two years in prison for fraud

Former business partner to be paid $150,000 in restitution

A federal judge assessed Peggy Newton two years in prison Thursday for defrauding her business partner in a home decor shop in downtown Joplin.

At a hearing in federal court in Springfield, U.S. District Judge Richard Dorr ordered that Newton, 39, serve the term without any possibility of parole and that she pay $150,000 in restitution to her former business partner, Diane Pine.

Newton was indicted in February 2011 on 21 counts of wire fraud and four counts of uttering forged and counterfeit checks. The indictment alleged that she defrauded Pine by embezzling money from their business, Evergreen & Amber, between 2006 and 2009.

She pleaded guilty Oct. 14 to a single count of wire fraud in a plea deal with the federal prosecutor’s office in Springfield that allowed the other counts to be dismissed.

Newton managed the financial aspects of the home decor business, while Pine provided the financial capital and saw to the design side of the business. Pine said in a telephone interview Thursday that she attended the sentencing hearing and felt sorry that her former business partner is going to prison.

“The truth of the matter was: I cried for her,” said Pine. “It shouldn’t have had to come to this.”

She said that when the embezzlement first began to come to light in 2009, she thought her partner had just made a mistake. Pine, 65, said she even went back to work as a nurse in Texas in an effort to earn enough money to cover the financial damage to their business and to keep the shop open.

It was not until her son, a certified public accountant, began looking into the matter that she became aware of the full extent of the embezzlement, she said.

“I was shocked and just devastated,” she said. “I felt betrayed by someone I thought of and treated as a daughter.”

The U.S. attorney’s office said in a news release after the sentencing that Newton wrote almost 400 checks on the shop’s bank account to make purchases and obtain money for personal benefit. She used Pine’s and the shop’s credit cards to make other purchases and obtain more cash for personal use on about 500 occasions during the three-year period.

The defendant also used Pine’s name and personal information to make eight applications for new credit card accounts without her partner’s knowledge or consent and was successful in opening four such accounts, the U.S. attorney’s office said.

The single criminal count to which she pleaded guilty involved the purchase of family portraits from Lagow Portrait Designs in Joplin in 2008. The portraits cost $1,926 and Newton paid for them using Pine’s credit card without her knowledge or consent.

Newton’s sentencing initially was set for May, with continuances granted more than once because of  differences in the prosecution’s and the defense’s understanding of the plea agreement and a pre-sentencing report.

A memorandum filed Monday by defense attorney John LeWright asked the judge to depart from guidelines the defense believed called for a sentencing range of four to 10 months and to grant his client probation instead. The defense’s memorandum also argued that the most the defendant should be required to pay in restitution was $54,266.38.

The sentencing memorandum filed by the U.S. attorney’s office sought a prison term of at least 71 months followed by a three-year period of supervised release and restitution totaling $269,247.70, with $263,658.01 owed to Pine and the remainder to a bank.

 

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