Ex-DSS employee charged in $1.78M embezzlement case may be allowed to leave state

PIERRE, South Dakota — A former South Dakota Department of Social Services employee, who allegedly embezzled about $1.78 million from the agency, may be allowed to return to Iowa in the near future.

Lonna Carroll, 68, of Algona, Iowa, made her first appearance for two counts of felony grand theft Thursday at the Hughes County Courthouse.

Carroll is accused of stealing funds from Child Protection Services, a division of the state department that handles reports of child abuse and neglect and "connect[s] parents with the needed resources to help increase their ability to keep their children safe," according to the agency's website .

The former DSS employee is suspected of requesting funds from the division and then approving her own requests before intercepting checks meant to be used for a specific child. Carroll allegedly made more than 500 illicit transactions between Jan. 1, 2010 and March 24, 2023, and the embezzlement was discovered by DSS in February 2024.

On Thursday, the court decided to place a $50,000 bond on Carroll, who was arrested in Algona and later extradited to South Dakota.

In a press conference following Carroll's appearance, Attorney General Marty Jackley, who is prosecuting the case, told reporters the court "is open to" allowing the former state employee to return to Iowa.

"There would need to be a plan put together," Jackley said. "I would have an opportunity to review it as a prosecutor and weigh in, and then the court would make that determination. Based on experience, I've seen anything from house arrest to limited to the four corners of the state."

The court also placed a waiver of extradition on Carroll, which would circumvent the extradition process if the former DSS employee breaks any bail terms upon her possible return to Iowa. The court also agreed to the state's request to require Carroll to report any spending above $2,500.

Based on Carroll's financial affidavit, the former employee also qualified for a court-appointed attorney, Jackley said.

"I've said earlier that there was not going to be a likelihood — from what we know at this stage of recovery — of a significant amount of restitution," the attorney general said.

Carroll's charges are split between a class 2 felony and a less severe class three felony. The maximum sentence for a class 2 felony is 25 years in prison and a $50,000 fine. The maximum sentence for a class three felony is 15 years in prison and a $30,000 fine.

Carroll's arraignment is scheduled for Aug. 27.

This article originally appeared on Sioux Falls Argus Leader: Ex-DSS employee charged in $1.78M embezzlement case may be allowed to leave state