Controller arrested, charged with embezzling $16.6 million from Texas fruitcake company

The FBI has arrested the controller of Collin Street Bakery for mail fraud, three weeks after the Corsicana, Texas, fruitcake giant filed a lawsuit alleging that he had embezzled more than $16.6 million since January 2005 until he was fired this June, the U.S. attorney's office in Dallas said Tuesday.

Aug. 14, 2013

According to a news release, Sandy Jenkins spent the money on 43 luxury cars, a vacation home in Santa Fe, N.M., private plane travel, and a $3 million watch and jewelry collection. His spending at Neiman Marcus department store alone topped $1 million, according to an affidavit filed by FBI agent Christine L. Edson.

Jenkins, 64, was arrested Monday after a July 24 FBI raid on his home in Corsicana, 80 miles southeast of Fort Worth. The Corsicana Daily Sun reported at the time that a Mercedes and a Lexus were towed off in the raid.

According to Edson’s affidavit, the fraud was uncovered by accounting clerk Semetric Walker, who refused to believe Jenkins’ explanation that a $20,000 check was written to cover postage.

Walker brought her suspicions to high-level executives in the family-owned bakery after finding that a number of postage-related checks were actually paid into accounts unconnected to the bakery’s business.

The affidavit alleged that the controller had gone into the bakery’s computerized accounting system to create 88 fraudulent checks with matching fake entries indicating payments to vendors.

The affidavit exposed lax procedures at Collin Street, saying that there had been no audit during Jenkins’ eight years of employment. Bakery President Robert McNutt, whose family owns the company, told Edson that the fraudulent checks carried his electronic signature and that he never reviewed them after they had been printed.

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