PAGO PAGO, American Samoa (AP) - An American Samoa couple accused of stealing nearly $400,000 from a low-income housing project to pay off their credit cards, fund other businesses and help pay off a condo in Hawaii has been sentenced to home confinement and ordered to pay restitution.
John Emil Kruse and his wife, Elaine Gurr Kruse, appeared Thursday in a federal courtroom in Washington, D.C., to enter pleas and be sentenced. There’s no federal court in American Samoa.
U.S. Justice Department spokesman Peter Carr said Thursday from Washington that the Kruses pleaded guilty to single charges each of taking government property for personal and business use. Each was sentenced to four years of probation after serving eight months of home confinement. They also must pay back nearly $400,000 in funds they received through a government program to build an eight-plex for low-income renters.
Their attorneys argued that the housing project stalled when they couldn’t get workers, and they began to use the government funding as a short-term loan.
George Allen Dale, defense attorney for Elaine Kruse, said his client accepted responsibility for what she did and expressed her sincere remorse.
He also said in an email to The Associated Press that four years of probation “was a fair and just sentence from a judge who understood the true nature of the crime and the true character of Mrs. Kruse.”
Gregory S. Smith, attorney for John Kruse said Thursday via email that the “Kruses are good people” and the court handed down the right sentence.
“We believe the court appropriately tempered justice with mercy here, and entered a balanced sentence that properly took into account the Kruses’ larger life story, not just the charges filed in this case,” Smith said.
This case was investigated by the FBI, led by the Honolulu office, and the U.S. Treasury Department’s Office of Inspector General.
Honolulu FBI spokesman Special Agent Tom Simon said on Thursday via email that this case underscores the office’s commitment to investigating the misuse of federal funds in American Samoa and the Pacific.
John Kruse is the director of the American Samoa Procurement Office and is from a well-known family in the U.S. territory. His brother, Michael Kruse, is American Samoa’s chief justice.
American Samoa Gov. Lolo Matalasi Moliga wasn’t immediately available for comment.
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