Former DSS employee indicted for $1.78 million theft

SIOUX FALLS, S.D. (KELO) — South Dakota Attorney General Marty Jackley said in a Thursday news conference that a former state employee has been indicted on two charges of theft in a scheme involving state money.

Lonna Carroll, 68, of Algona, Iowa, is accused of stealing $1.78 million from the South Dakota Department of Social Services, specifically the Child Protective Services branch. Carroll would request a payment for a child from the state and was able to intercept that approved check and eventually, deposit it in a personal account, according to the AG.

Carroll is charged with two felony counts of aggravated grand theft.

Jackley said the alleged crimes happened from 2010 through March 2023 when Carroll left the DSS. Carroll was able to intercept the money despite the DSS having an approval process for monetary requests that includes a supervisor, Jackley said.

Carroll was in a role where she made the request but was the supervisor who approved her own request, Jackley said. DSS would then review the request and approve it, Jackely said.

“There was no supervisor because she was serving as supervisor,” Jackley said.

The payback of $1.78 million in state and federal money is unlikely, he said.

“It’s my understanding that there is not a strong likelihood of discovery for restitution,” Jackley said.

As to motivation for the alleged crime, Jackley did not comment specifically but did say in general,” If we were to do an investigation, one of the things we look for is motivation.”

Motivation can include finances but also addicitions such as gambling, he said.

Jackley said he couldn’t comment specifically on the DSS approval structure and how Carroll was able to both make a request and self-approve that request. Carroll’s title was project assistant, Jackley said. His job is to investigate when the problem was discovered.

The investigation was complicated because it involved more than 500 transactions, Jackley said. The defendent also accused of adjusting the account requests which also made it more difficult to track, he said.

The alleged theft was discovered in February this year by the DSS through some system checks and improvements it had made, Jackley said. The state Department of Criminal Investigation investigated accounts from banks, including the former employee’s bank and DSS records.

The state open South Dakota website listed Carroll’s final wage at $21.09 per hour.

Carroll was arrested in Kossuth County, Iowa, where she is waiting for extradition. Bail has been set at $50,000.

No DSS officials were at Thursday’s news conference.

Check KELOLAND News for additional coverage of the indictment.

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