Broken trust brings prison for ex-bank official
Former manager admits embezzlement.
Broken trust brings prison for ex-bank official

By Tony Thornton

Published: July 16, 2008

MUSKOGEE — Rhonda Harris spent 25 years building the trust of her mostly elderly clientele.

Tuesday, the former Wagoner bank manager apologized in court for the $5.6 million in total loss she caused by embezzling from those same clients' accounts.

Her apology fell on deaf ears. A federal judge ordered Harris to spend 14 years in prison — the maximum sentence allowed under federal guidelines.

Harris, 50, also must pay a total of $5.3 million to Arvest Bank and its insurer after she leaves prison. However, at the court-ordered payment of $400 a month, it is unlikely Harris will be able to fully repay what she stole.

Harris was not accused of actually embezzling $5.6 million, but caused at least that much in losses to her clients, the bank and its insurer before and after Harris' crime was discovered.

The money helped Harris and her family acquire property, farm equipment and three vehicles, including a Hummer. She also paid for one son's Hawaii honeymoon, Assistant U.S. Attorney Doug Horn said.

Several of Harris's former customers and Arvest Bank officials filled a federal court- room in Muskogee for her sentencing.

Bank customer Wendell Hancock, 67, told U.S. District Judge Ronald A. White that he once had "all the trust in the world” in Harris. Since learning of her thefts, Hancock said, he's endured tax problems and "a lot of sleepless nights.”

"It seems like Rhonda was preying on people my age and older ... hoping that someday we would pass, and that money would be untraceable,” Hancock said.

Horn said investigators verified $5.6 million in losses and 80 to 90 victims from Harris' actions.

Harris pleaded guilty in February to a two-count indictment alleging embezzlement and money laundering.

Before being sentenced, Harris told U.S. District Judge Ronald A. White, "There's no excuse for my behavior. ... I'm sorry for all the harm that I caused.”

The punishment range at White's discretion was roughly 11 to 14 years in prison. Defense attorney Donn Baker asked White to impose the minimum sentence, saying she would be 61 or 62 years old upon release, "which will more than punish her.”

The judge ordered Harris to report to prison Aug. 8 but allowed her to remain free until then.

Horn described her scheme this way: Harris would plunder from certificates of deposit and money market accounts, which customers typically left alone for years at a time.

When someone cashed in a CD, Harris would steal from some other CD or money market account.

"She was robbing Peter to pay Paul,” Baker said.

However, because Harris kept no records of her thefts, there is no way to say with precision whether everyone was repaid, Horn said.

It was discovered in October 2006 when a customer came in to cash in a CD on Harris's day off and was told there was no record of his account.

Kirk Hays, an Arvest vice president, recalled calling Harris and asking about it. She confessed 25 years' worth of thefts, Hays said.

An audit team was called in as the first step in a painstaking process aimed at reimbursing every customer who lost money, he said.

Most of the thefts occurred before Arvest bought the bank branch in 2003.

Hays said, "it was our goal from Day 1 to take care of the customers the right way. ... I think 99 percent of those customers would say we did,” Hays said.

As part of her plea agreement, Harris spent two days helping Arvest officials unravel her thefts. Arvest and its insurer reimbursed every customer whose losses could be verified.

One person who isn't satisfied is Linda Rogers of Oklahoma City, whose elderly aunt lost her life savings to Harris.

Rogers' aunt, Lillian Reardon, is a widow who so trusted Harris, she gave her power of attorney eight years ago.

After Reardon moved into a nursing home, Harris wiped out Reardon's savings and sold her house, keeping the down payment.

Rogers later got a call indicating her aunt's $400,000 in assets were gone. Reardon is now a ward of the state, Rogers said.

The niece blames Arvest in part, saying Harris used the trust she built as the bank's manager to take advantage of Reardon.

Don Walker, Arvest's regional president in Tulsa, said the power-of-attorney issue makes Reardon's case unique from the others.

Harris's action with Reardon's assets "wasn't as a banker, in our opinion. It was through a personal relationship that she built with Mrs. Reardon,” Walker said.

He said upon learning of the situation, he drove to the Muskogee nursing home where Reardon lives and confirmed that her needs would be met.

The bank is overseeing a process to have the new owner of Reardon's home make monthly payments to benefit Reardon, Walker said.

"We want nothing but the best” for Reardon, he said.

Walker said Reardon's situation is among "one or two” instances from Harris's thefts "that we don't know what to do.”

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