Indictment: Former UK employee faces federal theft, fraud charges

A former University of Kentucky employee is facing charges of federal program funds theft and wire fraud after allegedly using school funds to purchase personal items.

Stephanie Carpenter, formerly an administrative support associate with the university’s College of Education, was indicted by a federal grand jury according to documents filed on Thursday.

In an internal audit released in 2020, UK found that Carpenter allegedly spent $256,000 on authorized purchases with her university Procard over the span of three years. UK officials said at the time they turned the audit over to law enforcement.

UK utilized a Procurement Card Program (Procard) to facilitate purchasing and paying for goods and services of small-dollar amounts. Procards were issued by UK’s bank in the name of individual employees, but remained the property of UK.

The indictment states Carpenter utilized her UK Procard to make frequent online purchases of computers and other technology items using university funds. None of the items were requested for purchase by the university or the college of education.

As part of her job responsibilities, the indictment explains Carpenter had authority to make certain purchases on behalf of College of Education faculty and administrators. As long as purchasing amounts stayed below certain thresholds, Carpenter did not need further authorization within the UK purchasing structure.

She was also responsible for making travel arrangements for some faculty and ensuring expenses were paid or reimbursed, according to the indictment.

“Carpenter purchased dozens of products from the Apple Online Store using her UK Procard, including Apple MacBooks, iMacs, iPhones, and iPads. She also made unauthorized purchases of Hewlett-Packard (HP) and Dell computers from Amazon and Amazon Marketplace,” the indictment reads.

Once she placed an order for these items, the indictment alleged she shipped these items to either her office or her residence and embezzled and sold them to private individuals. Carpenter allegedly found buyers for these electronics either locally or by placing them for sale on Craigslist, and keeping all the proceeds.

According to UK’s audit, Carpenter spent nearly $243,000 on 84 iPhones, 55 MacBooks and 22 iPads. The purchases are stated to have been made beginning in April 2017 through March 2020, when she was terminated.

However, in November 2018 Carpenter requested an increase in her spending limit even though the needs were unnecessary in her role as an administrative support associate. She received the increase according to the indictment, and allegedly used the increase to “embezzle electronics at a greater rate” at that time.

“In a separate part of her scheme, Carpenter utilized her UK COE Procard to pay for personal travel expenses (flights, hotels, rental cars), none of which were authorized as part of her employment with UK COE,” the indictment said. “During her employment with UK COE, Carpenter charged at least 25 personal trips to her Procard, submitting false documents to make it appear as if other UK employees were traveling for a legitimate business purpose.”

This began to “raise red flags” at the university when Carpenter allegedly made misinterpretations on communications and internal forms in her requests for the electronics. The indictment alleged Carpenter doctored authorization documents to explain expenses for unauthorized personal travel.

Carpenter faces three counts of federal program funds theft and six counts of wire fraud, according to the indictment. If found guilty for all nine counts, Carpenter could face up to 30 years in prison. She could also face a fine of $250,000 or twice the amount of gross gain or loss from the conduct for both charges, and supervised release for six years.

Carpenter may also be required to have a mandatory special assessment of $100 per count as well as restitution.

She is scheduled to appear for arraignment on May 18 at 10 a.m. before Magistrate Judge Matthew Stinnett.