- Associated Press - Tuesday, June 26, 2018

SIOUX FALLS, S.D. (AP) - The lawyer for a former South Dakota educational cooperative employee charged in an embezzlement scheme denied Tuesday that she knew about alleged financial misconduct uncovered after the cooperative’s business manager shot his wife and four children, then set fire to their house and killed himself in 2015.

Defense attorney Clint Sargent said during opening statements in the theft trial of Stephanie Hubers that jurors won’t see any evidence she knew about the embezzlement, arguing also that Hubers “didn’t steal a thing.”

Hubers is a former Mid-Central Educational Cooperative staffer accused of receiving about $55,000 to keep quiet about the embezzlement by Mid-Central business manager Scott Westerhuis and his wife before their deaths in the 2015 murder-suicide. Attorney General Marty Jackley told jurors that Hubers knew about the couple’s theft, participated in it and profited from it.

Stephanie Hubers knew about this and played an active role in it,” Jackley said in the court room in Sioux Falls.

Hubers pleaded not guilty to one count of grand theft and two counts of grand theft by deception and three alternative receiving stolen property counts. She faces a maximum sentence of 10 years in prison and fines for each count.

She’s accused of getting roughly $55,000 from a nonprofit called the American Indian Institute for Innovation from 2009 to 2014 that she wasn’t entitled to or that she knew had been stolen.

Jackley said Hubers invoiced the nonprofit for payment for work she didn’t perform. Hubers told authorities that Scott Westerhuis paid her extra money from the nonprofit beyond her Mid-Central salary to perform duties such as research. She said the additional duties quickly stopped, but the extra money kept coming, according to court documents.

But Sargent said the money Hubers received from the nonprofit was paid to her like a contractor after Mid-Central wouldn’t approve a raise for her.

Hubers‘ trial comes more than two years after authorities launched a financial investigation because of the deaths. Investigators believe the total amount that Scott Westerhuis and his wife, Nicole, stole before their deaths surpassed $1 million.

The investigation spurred the felony charges in 2016 against Hubers, 45, of Geddes, and two others who allegedly helped in the couple’s embezzlement scheme.

Mid-Central employees didn’t know about transfers from nonprofits Scott and Nicole Westerhuis ran - including the American Indian Institute for Innovation - to their own consulting companies or themselves, Sargent said.

He said prosecutors claim that Hubers knew about the embezzlement, but jurors wouldn’t “see any evidence of that.”

“It’s a theory. It’s based on our most cynical views of, ‘Oh she had to know,’” Sargent said. “It was a shock to everyone to find out that Scott and Nicole were liars and thieves.”

Sargent said Hubers tried to help authorities after the deaths.

After the opening statements, jurors heard from Division of Criminal Investigation agents, state Department of Legislative Audit officials and a September 2015 interview DCI investigators conducted with Hubers.

In the interview, not long after the killings and fire, Hubers said that obviously there was activity going on “unbeknownst” to her. She said the only thing she knew about the American Indian Institute for Innovation was the money she had received, an arrangement she said Scott Westerhuis had with two other Mid-Central employees.

One agent assured her that she wasn’t in trouble.

Hubers said the Westerhuises were “tight knit,” and said Scott Westerhuis told her that they were a private family. She described her own relationship with the family as one that included watching their children and knowing their routine.

Testimony from a DCI agent was set to continue when the proceedings started again on Wednesday. The two others charged in the case, former Mid-Central Director Dan Guericke and consultant Stacy Phelps, are to face trial later.

Guericke and Phelps are accused of backdating two contracts between Mid-Central and the American Indian Institute for Innovation in August 2015 before they were made available to the state Department of Legislative Audit. Investigators say in the court records they believe the contract changes were an attempt to avoid a potential audit of the Institute.

Guericke is also accused of conspiring with Scott and Nicole Westerhuis to backdate contracts with other people.

Guericke has been charged with six felony counts for falsifying evidence and conspiring to offer forged or fraudulent evidence. Phelps, who previously served as chief executive of the American Indian Institute for Innovation, is charged with four felony counts for those alleged crimes.

Sign up for Daily Newsletters

Manage Newsletters

Copyright © 2019 The Washington Times, LLC.

Please read our comment policy before commenting.


Click to Read More and View Comments

Click to Hide