South Dakota Attorney General Marty Jackley announced the indictment of a former state Department of Social Services employee Thursday at the Police Law Enforcement Center in Sioux Falls.
Lonna Carroll, 68, of Algona, Iowa, has been indicted for allegedly stealing about $1.78 million from the department's Child Protection Services.
Carroll was charged with two felony counts of aggravated grand theft, according to indictment documents filed in South Dakota's Sixth Judicial Circuit Court. Jackley said the thefts were discovered by DSS in February 2024.
The former DSS employee was arrested Wednesday in Algona, Jackley said, and is currently in the process of being extradited to South Dakota.
Carroll's first charge in this case is a class 2 felony grand theft, which is used when a suspect is said to have stolen more than $500,000 in property. According to court documents, this occurred between July 1, 2013 and March 24, 2023 in Hughes County. Jackley told reporters this charge involved about 399 transactions where money was stolen.
The former DSS employee's second charge is class 3 felony grand theft involving more than $100,000 in stolen property. This allegedly occurred between Jan. 1, 2010 and June 30, 2013, also in Hughes County. Jackley said this charge involved another 172 transactions where money was stolen.
Jackley explained certain DSS employees can request money from CPS for foster care and other child service related matters.
Typically, when a DSS employee requests funds, their application goes through "double supervisory review." Upon approval, the funding request is forwarded to the DSS' financial staff, who then ask the state auditor for a warrant for payment, or a bank check with the desired amount, Jackley said. Depending on the circumstances, the state treasurer may also become involved if a wire transfer or similar process is needed to move the money where it is requested.
Where Carroll's suspected corruption case differs, however, is that she was both requested CPS funds and installed herself as the supervisor of her own requests, which allowed her to approve her own requisition.
Jackley elaborated that once her requests received the state auditor's approval, Carroll allegedly intercepted the funds and took them directly to a bank.
"Then, when the check was deposited in the name of the bank in that particular bank, she immediately withdrew the funds, took the funds, the cash, to a different bank, and placed them in her personal account," Jackley said.
“Citizens expect government agencies and employees to safeguard public funds,” Jackley wrote in a press release. “I appreciate the cooperation of Gov. Noem and the Department of Social Services throughout this investigation.”
Matt Althoff, DSS secretary, wrote in a statement Thursday to the Argus Leader that department staff discovered Carroll's "suspicious financial activity" and reported it to DCI.
"DSS utilizes both internal and external audits, reconciliations and internal controls to safeguard public funds," Althoff stated. "Additional safeguards have already been implemented, and we continue working to identify further prevention and detection methods."
An initial court appearance for Carroll has not yet been scheduled in Hughes County Circuit Court in Pierre. The maximum sentence for count one is 25 years in prison and a $50,000 fine. The maximum sentence for count two is 15 years in prison and a $30,000 fine.
Spokesperson Tony Mangan said the Attorney General's Office will be prosecuting the case.
This story is developing. Please check back later for updates.
This article originally appeared on Sioux Falls Argus Leader: Former South Dakota DSS employee indicted for stealing $1.8M from Child Protection Services
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