A Texas woman admitted embezzling more than $29 million over the past decade from the prominent Dallas family that employed her as a bookkeeper, according to the Department of Justice.
Barbara Chalmers, 74, pleaded guilty Thursday to using her position with a charitable foundation and multiple companies run by the family of Jim Collins, a businessman and Republican congressman who died in 1989, to fraudulently write herself at least 175 personal checks. She directed the bulk of the stolen money to her own construction business, according to federal prosecutors.
"Not only did Ms. Chalmers brazenly abuse the trust the family placed in her, but she also stole millions of dollars from a charitable foundation dedicated to improving the lives and health for so many in need in the Dallas community," Ephraim Wernick, an attorney for the family, said in a statement.
Court records show that Chalmers held various roles involving financial record-keeping for entities owned by Collins's descendants, and the family itself. The entities include the Collins American Capital Corp., International Family Investors Ltd. and the James M. Collins Foundation.
"Alarming red flags"
The family discovered the fraudulent activity last year, after the death of Collins' wife, Dorothy Dann Collins Torbert, who had previously owned and managed the family's corporate entities. When her descendants took over ownership of the family businesses, they reviewed bank statements and identified "several alarming red flags involving Chalmers," according to a lawsuit they filed against their former bookkeeper in 2021.
The red flags included dozens of unauthorized checks written to Chalmers from various accounts in the two years prior to Torbert's death totaling more than $5.7 million.
But the total theft was significantly larger, and involved years of fraudulent activity beginning in 2012. During that time, Chalmers wrote 175 checks to herself from the family's accounts and then provided false paperwork to tax professionals with inaccurate figures for the entities' year-end cash-on-hand values in order to cover her tracks, prosecutors said.
As much as $25 million of the stolen funds went to Chalmers's construction company, identified in court records as W.O.E. Construction Inc.
"Massive fraud"
Chalmers was charged with money-laundering on Dec. 14 and pleaded guilty on Thursday. A sentencing date has not been set, but she faces a maximum penalty of 10 years in prison.
"Ms. Chalmers' actions compounded what was already an incredibly difficult time for the family," Wernick said. "With today's announcement, the Collins family begins the process of healing, but this is only the first step towards accountability for all those who contributed to this massive fraud."
Collins headed the Fidelity Union Life Insurance Co., a firm co-founded by his father, prior to running for Congress, where he served from 1968 to 1983. Allianz SE acquired Fidelity Union in 1979. Buildings at Southern Methodist University and Baylor University Medical Center are named after Collins.
Two of his and Torbert's children, Michael James Collins and Dorothy Collins Weaver, later founded the hedge fund firm Collins Capital Investments.
