Sr. Mary Margaret Kreuper, CSJ and Sr. Lana Chang, CSJ, who both retired this year from St. James Catholic School in Torrance, are alleged to have misappropriated nearly $500,000 from the school.
They are suspected of using the money for gambling, trips, and other personal expenses.
While the archdiocese initially said that it would not press charges in the case, an archdiocesan spokesman told CNA Monday afternoon that the archdiocese will become a “complaining party” in the case.
Kim Westerman, a spokesperson for the Sisters of St. Joseph of Carondelet, told CNA Monday that canonical restrictions have been imposed on the sisters, and a formal canonical process “will be determined when the criminal aspect of the case is completed.”
Westerman told CNA that the sisters’ alleged embezzlement was not known before their retirements from the school was announced, and that the congregation has no record of either sister being accused of financial misconduct in the past.
In a Dec. 11 statement, the Sisters of St. Joseph announced that they would not defend the actions of Krueper and Chang.
“What happened is wrong. Our Sisters take full responsibility for the choices they made and are subject to the law.”
A Nov. 28 letter from St. James Parish pastor Msgr. Michael Meyers announced that after an internal investigation discovered the embezzlement, the sisters’ congregation “has agreed to arrange for full restitution for the benefit of the School of the funds that are found to have been misappropriated and is imposing appropriate penalties and sanctions on each of the Sisters in accordance with the policies of the Order.”
In his letter, Meyers wrote that “the Archdiocese does not wish to pursue criminal proceedings against the Sisters but instead plans to have the Archdiocese, the School and the Order address the situation internally through the investigation, restitution and sanctions on the Sisters.”
Despite the theft, “no student or program at St. James has suffered any loss of educational resources, opportunities, or innovations. In sum, the education of your children has not and will not be affected by these events,” Meyers wrote.
He added that the sisters felt “deep remorse” for their actions and asked for forgiveness.
Meyers told parents last week that the sisters’ theft went undetected because they took money destined for a reserve fund, and did not immediately attract the attention of auditors and other officials.
St. James School’s 2016 enrollment was 325 students, according to an archdiocesan directory.
Some parents at the school alleged that the sisters often took gambling trips to Las Vegas. Krueper has a P.O. Box and a prior address in Las Vegas, according to The Beach Reporter.
Marge Graf, an archdiocesan attorney, told St. James School parents that the sisters “had a pattern of going on trips, we do know they had a pattern of going to casinos, and the reality is, they used the account as their personal account,” The Beach Reporter noted.
The sisters are members of the Los Angeles Province of the Sisters of St. Joseph of Cardondelet. Though they are commonly referred to as “nuns,” that term is reserved in the Church to consecrated women living in contemplative monasteries. Kreuper and Chang are more properly referred to as “religious sisters.”
Lori Barr, a former principal of St. Paul School in Santa Fe Springs, California, was sentenced in 2015 to 180 days in county jail for stealing $64,000 from the school, which is owned and operated by the Los Angeles archdiocese. Barr was discovered to have made charges on the school’s American Express card, making purchases from Disneyland, Tiffany & Co, United Airlines, and Victoria’s Secret, among others.
Barr paid restitution to the archdiocese before she was sentenced, and apologized to school and diocesan officials.
It has not yet been announced what charges Krueper and Chang will face.
This story is developing and has been updated.