FAYETTEVILLE -- Felony fraud and theft charges have been filed against a former University of Arkansas, Fayetteville administrative assistant after an investigation found 248 unauthorized purchases totaling about $335,700, according to a police affidavit filed in the case.
Esther Kathryn Lake, 44, pleaded innocent Oct. 15 to felony theft of property and five felony counts of fraudulent use of a credit card, Washington County Prosecuting Attorney Matt Durrett said Friday.
Durrett described the charges as connected to the unauthorized use of "p-cards," or procurement cards. Her next court appearance is set for April 8, Durrett said.
A University of Arkansas Police Department affidavit describes UA officials as stating that Lake had access to a rubber stamp of the signature of Steven Bell, at the time an academic department chairman whom she worked with as an administrative assistant.
Bell told police that Lake used the stamp on unauthorized invoices -- thus avoiding detection -- despite her being "only authorized to use the stamp for academic purposes, and never for purchasing," states the affidavit signed by Sgt. David Robertson.
The affidavit states that approximately $200,000 in purchases were made at electronics retailer Best Buy, with records showing items such as gaming computers then later sold on Facebook.
Bell is an associate professor and formerly the head of UA's Department of World Languages, Literatures and Cultures, a department within the university's Fulbright College of Arts and Sciences. He told police that Lake was not authorized to purchase computers and "confirmed that his signatures were either stamped or forged," the affidavit states.
Lake had a purchasing card issued to her, but she also is described as using someone else's card. The affidavit states that Joseph Covey was director of UA's Center for World Languages during a time period that included when the unauthorized purchases were made, and he told police that Lake had access to his card.
The affidavit describes unauthorized purchases as being entered into a central procurement database as "'computer for lab' or 'computer for global teaching needs.'"
An assistant dean at UA came forward in March to report potential fraud, the affidavit states. Upon Lake's resignation, the assistant dean became aware of two suspicious charges, which led to an investigation of previous purchases made by Lake during her employment, according to the affidavit.
John Thomas, a UA spokesman, said in an email Friday that a transition to a new technology system known as Workday for managing personnel and finances led to discovery of the unauthorized charges.
"Kathy Lake was employed at the university from July 2015 until Feb. 28, 2021, when she voluntarily resigned. She is believed to have acted alone," Thomas said.
Since discovery of the unauthorized purchases, "several measures have been put into place regarding use of procurement cards, including reducing authorized card holders, placing additional limits on approved uses, reducing allowed transaction amounts, and centralizing purchasing and inventory tagging processes on technology purchases," Thomas said.
Records subpoenaed from electronics retailer Best Buy showed purchases of computers and other technology -- including many gaming computers -- made in Lake's name, according to the police affidavit. Lake's Best Buy "reward account" showed purchases made using the UA "p-card" provided to her, as well as Covey's purchasing card, the affidavit states.
Police, searching Lake's publicly-available social media, found sales of computers and technology, and a search warrant for Facebook data identified Lake as having sold hundreds of items, including many computer and technology items, the affidavit states.
"The technology items she sold matched the Best Buy items she purchased," states the affidavit, which also describes Lake as having membership in various online Facebook groups for buying and selling items in Northwest Arkansas.
The affidavit also states that records from Enterprise Rent-A-Car showed Lake renting vehicles using a university purchasing card, despite a UA official stating that Lake did not have any university-funded travel matching the costs shown in the records. The affidavit also refers to a plane ticket purchased for a relative of Lake's who had no relationships to the university.
Lake was booked into jail on Sept. 29 and then released the same day from the Washington County jail on a $3,500 bond, according to records released by the Washington County sheriff's office.
No attorney for Lake was listed in court records, and no one answered the door Friday at a Springdale residence listed for Lake.
The official charging document, filed Sept. 28, lists counts of fraud dating back to a time period between Oct. 1, 2018, and Feb. 28, 2019, with fraud described as continuing on in successive, months-long time periods through January.
Unlike the police affidavit, no sum or total is given for the fraud amount in the official charging document.
But four of the fraud counts are separately listed as being for more than $25,000, as is the felony count of theft of property, and each count is considered a Class B felony. Under state law, a Class B felony is punishable by a sentence of between five and 20 years in prison.
Another fraud count is listed as a Class C felony, which is punishable by a sentence of between three and 10 years in prison.