Watchdog: Follow the Money

Reno trial on faith-based fraud charges nears end

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Associated Press,Watchdog,Watchdog Blog,Waste and Fraud,Follow the Money,Nevada,Nonprofits

RENO, Nev. — Closing arguments are scheduled Monday afternoon in the trial of a Reno businessman accused of bilking the government out of $200,000 intended for nonprofits.

The jury then will begin deliberations in the case involving Mike Stickler, whose Faith Based Services was one of several groups he ran that he said raised money to benefit Christian organizations and other nonprofits.

His application indicated $200,000 of a $500,000 grant in 2007 would be distributed in $25,000 increments to eight "sub-grantees," but prosecutors said the amounts were not paid.

Stickler took the stand Friday in U.S. District Court in Reno and testified that his bookkeeper, Katie Petri, stole the grant funds, The Reno Gazette-Journal reported.

Stickler said he never directed or authorized Petri to spend the grant money and he did not know the entire $500,000 had been spent until long after it was gone.

"Did you order Ms. Petri to draw down the money?" assistant federal public defender Lauren Gorman asked Stickler.

"Absolutely not," Stickler replied.

"Why not fire her?" Gorman asked.

"(My wife Kim) and she were good friends," Stickler said. "We wanted to treat everybody as family. Immediately, I wasn't sure where the money was. I was piecing it out, one line at a time. I realized it would take time and I needed her help."

Petri, who has not been charged and was granted immunity for her testimony against Stickler, testified Wednesday that he was to blame. She said she spent the grant funds at Stickler's direction and most of the funds went to him or to cover bounced checks.

An Internal Revenue Service agent on Thursday testified that he tracked grant funds and found that most of the money went to Stickler's personal account. He also found funds that went to a variety of places, including a Hawaiian vacation.

Stickler has pleaded not guilty to theft of public money. A grand jury indicted him in 2012. If convicted, he could face up to 10 years in prison.

Closing arguments are scheduled to begin at 1 p.m. Thursday.

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