A 58-year-old Sag Harbor woman pleaded guilty last Monday to defrauding her former employer out of more than $250,000 using a company credit card and now faces 12 to 18 months in prison when she is sentenced in March next year.
Federal prosecutors say Stephanie Bitis racked up personal expenses, including an international vacation, on a Long Island Radio Broadcasting credit card and then hid the unauthorized charges by providing false information to accountants.
Ms. Bitis worked at Long Island Radio Broadcasting, the parent company of East End radio stations WEHM, WBEA and WBAZ, as general manager from September 2015 until her employment was terminated in November 2017. She is also a former member of the Sag Harbor Board of Education.
Ms. Bitis had waived the right to have the case presented to a grand jury to determine if there was probable cause for an indictment. Instead, a “felony information” for a single charge of “access device fraud” was unveiled during last Monday’s arraignment, which took place over a video conference due to the COVID-19 pandemic. The “access device,” in this case, being the company credit card.
Under the statute, the maximum sentence for a single count of access device fraud is 15 years, but sentencing guidelines in Ms. Bitis’s case — because she has no known criminal history — are for 12 to 18 months in prison, according to the U.S. attorney’s office for the Eastern District of New York.
U.S. District Judge Gary R. Brown questioned Ms. Bitis to determine that she understood she was waiving her right to a trial by pleading guilty and that she could not withdraw her guilty plea if the sentence was more severe than she was expecting. Additionally, under the plea deal struck with prosecutors, Ms. Bitis may only appeal the length of the sentence if it is greater than 21 months.
Assistant U.S. Attorney Anthony Bagnuola told Judge Brown that the plea agreement provides for a maximum fine of $250,000 or twice the gross gain from the crime charged, whichever is greater. The deal also includes mandatory restitution to the victims, in an amount to be determined by the court.
Mr. Bagnuola said the government is aware of at least two parties who plan to seek restitution, Long Island Radio Broadcasting and the company’s insurance carrier. The insurer paid out $250,000 to Long Island Radio Broadcasting, which it is seeking to recoup, and Long Island Radio Broadcasting will ask for restitution for losses beyond the proceeds of the insurance policy, he said.
Mr. Bagnuola told the judge that he did not know even a ballpark figure for the total restitution sought.
“These radio stations are a passion — a true labor of love for all of us who work here,” said Long Island Radio Broadcasting’s owner and WEHM announcer Lauren Stone. “I was shocked and saddened that someone would do this to us — especially in such a small, tight-knit community. I’m thankful that justice has been served and that she will not be able to defraud anyone else.”
Thomas Kenniff, a New York attorney representing Ms. Bitis, said last Tuesday that the criminal charge stemmed from a dispute over business and personal charges with his client’s former employer. “We dispute that amount,” he said. “Those were not even the government’s numbers.”
He added that Ms. Bitis entered the guilty plea to the felony charge to seek closure in the matter.
“It’s unfortunate that something like this, which is not sensational at all, will make its way into the paper,” he said.
But reading from a prepared statement as she entered her guilty plea, Ms. Bitis explained what she did. She said she was hired in late 2015 as a station manager at Long Island Radio Broadcasting and shortly thereafter used the company’s American Express card to make unauthorized personal purchases. “I made efforts to disguise the true and unlawful nature of these expenditures by misrepresenting their personal nature on corporate accounting records and by making the necessary minimum monthly payment on my corporate American Express card so my fraud would not be discovered by the station owner.”
She said this continued for two years, until she was terminated in late 2017.
“My actions were intended to, among other things, disguise the true unlawful nature of these withdrawals,” she concluded.
Mr. Bagnuola said the credit card in the company’s name was issued to Ms. Bitis to cover expenses “reasonably related to the scope of her employment and her duties.” She then went on to use the card to her personal benefit, spending at least $200,000 on goods and services for herself and her family members.
Ms. Bitis doctored expense reports and related financial records to conceal the charges, Mr. Bagnuola said.
The prosecutor also shed light on why the crime is a federal case: The charges relate to interstate and international commerce because Ms. Bitis paid for a personal vacation overseas on the company card and sent falsified records to accountants in Colorado and elsewhere, he said.
Mr. Bagnuola did not request bail, and Ms. Bitis remained released on her own recognizance. The sentencing date was set for March 26.
With Stephen J. Kotz