Seattle sues former employee accused of stealing $1 million
Mar 13, 2012, 11:20 AM | Updated: 12:37 pm
The city of Seattle has filed a lawsuit against a former city employee accused of embezzling more than a million dollars in public funds, City Attorney Pete Holmes said Tuesday.
Joseph Phan, 44, has already been charged with 70 counts of criminal theft in what prosecutors have called the “largest embezzlement of public funds in modern King County history.”
The lawsuit, filed Friday in King County Superior Court, seeks to freeze the assets of Phan and his wife, Tra My Thi Le. The complaint accuses Phan of civil fraud, conversion of city funds, breach of fiduciary duty, and unjust enrichment.
“Our goal is full financial recovery for ratepayers through swift and aggressive civil remedies,” Holmes said in a statement. “The county prosecutor will address the criminal consequences of Mr. Phan’s conduct.”
Phan is accused of stealing $1.1 million from Seattle Public Utilities between 2008 and 2010. Prosecutors allege he diverted customer checks for water main extension projects into a personal bank account as a project engineer for the utility.
“This defendant both presented the bill to customers and collected the payment. That’s a recipe for embezzlement,” said King County Prosecutor Dan Satterberg. “It was a lot easier than one would expect to steal a million dollars from the city.”
Satterberg said Phan was able to open up a Bank of America account under his own name and “The City of Sea.” More than 70 checks made payable to the City of Seattle or to Seattle Public Utilities were deposited into the account totaling $1,090,762.16.
To date, investigators have seized $220,000 from the BofA account in Phan’s name.
“We are working closely with police and prosecutors to make sure that Mr. Phan retains none of his ill-gotten gains,” Holmes said.
According to Homes’ office, those ill-gotten gains include several undeveloped real estate lots and a rental home in Seattle purchased with stolen money; assets his office will seek to have frozen in court on Tuesday.
Meanwhile, Phan remains in the King County Jail on $750,000 bail. His criminal arraignment is scheduled for March 19.
