Wednesday, August 15, 2018

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Easy money, hard payback: Ex-con embezzler recounts the ease of lifting $8.5M from his employer and now taking ethical path

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Nathan Mueller seemed to have it all — a wonderful wife, a college degree, a good job as an accountant.

Then, for reasons he still doesn’t understand, he decided he wanted more.

So he took it from his employer, the ING Reinsurance Corp. office in the Twin Cities, to the tune of $8.5 million.  

When his embezzlement fraud finally ended four years later, Mueller pleaded guilty to one count of wire fraud and was sentenced in January 2009 to just over eight years in prison.  

Released in September 2014 after serving about 5½ years in federal prison in Duluth, Minn., he now makes an honest living sharing his story with students and business people around the country, including Wednesday night at UW-Eau Claire.

“I want people to learn from my mistakes,” Mueller said after his hourlong speech and a half-hour question-and-answer session in Davies Center.

Mueller, 44, described in detail how his fraud began small — his first fraudulent check was for $1,100 — with him just planning to steal enough to pay off his large student loan debt that he hadn’t told his wife existed. But it gradually escalated to the point where he once stole $400,000 in a single day through a scheme in which he requisitioned checks from ING accounts for a fake company and then cashed them for himself.

ING had limited internal financial controls and a climate in which employees often shared passwords and used whatever shortcuts were deemed necessary to get the job done, Mueller said, in explaining how he was able to get away with his fraud for so long despite living with guilt over his crime and the stress of expecting to get arrested every day he showed up at work. A key to his scheme was using the password of his best friend at the office — on her days off — to approve the fraudulent checks. 

“It was just shocking how easy it was,” he said.

In introducing Mueller, UW-Eau Claire accounting associate professor Bill Miller told the hundreds of people in the audience that 53 percent of all frauds are known by someone other than the perpetrator but not reported. He also noted that the vast majority of the university’s College of Business graduates will at some point in their careers encounter unethical or fraudulent practices in their workplace.

“We need to get people to take the next step — to speak up,” Miller said.

UW-Eau Claire accounting lecturer DeeAnne Peterson said what really struck her as a teaching moment was Mueller’s explanation of how he routinely made up complex, nonsensical explanations to justify anything that raised a red flag for auditors — often 23-year-olds just entering the field. Mueller described the auditors as looking for reasons that everything was OK as opposed to why they weren’t.     

“That’s important for our students to understand,” Peterson said. “So hopefully when the hair stands up on the back of their neck someday because something doesn’t seem quite right, they will remember Nathan’s words and have the courage to stand up and say something.”

Mueller, who spent much of his stolen money to support a gambling habit, said after he finally got caught he came clean and gave the FBI records detailing all his thefts and spending.

He entered prison thinking his life was over but actually found the experience allowed him to become a happy person for the first time in his life. It was in prison when he realized how rewarding it was “to confess my sins” while speaking to community groups.  

Mueller said his goal, especially when talking to college audiences, is to get students to think introspectively about the kind of people they want to be. 

“I want them to think about their ethics and morals,” he said, “and draw a line in the sand and say, ‘I’m not willing to cross that line.’ “

Mueller said he has paid back about $860,000 so far and expects to be paying restitution for the rest of his life.

Julie Eberle, president of the campus chapter of Beta Alpha Psi that helped sponsor the seminar, said Mueller’s powerful presentation was a great opportunity for her fellow students to learn from a real-life situation.

“If we can have any students or community members faced with a similar situation choose the right path, then we have done our job,” Eberle said.

Mueller’s presentation was followed by a panel discussion on fraud and ethics awareness.

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