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Duchnowski: ‘Cowgirl crook’ and local prosecutor hit TV

Published: Tuesday, April 1, 2014 10:09 p.m. CST • Updated: Monday, April 7, 2014 12:49 p.m. CST

Joseph Pedersen wouldn’t call Rita Crundwell “the cunning cowgirl crook,” as the federal prosecutor isn’t prone to giving defendants snazzy names.

“We don’t usually put labels like that on people we prosecute,” Pedersen said. “It’s not something we would do.”

But Pedersen, a Malta resident, acknowledges Crundwell’s case is the most interesting one of his career – for the complexities of the horse-show world and the challenges of selling off horses kept in more than a dozen states, if nothing else.

Crundwell was convicted of wire fraud for embezzling $53 million from the city of Dixon to fund an American quarter-horse-breeding empire. The city’s long-time comptroller, Crundwell was sentenced to more than 17 years in federal prison in February 2013, and her assets were sold to repay the small town that suffered years of tight budgets.

Pedersen, a former DeKalb County felony prosecutor, remembered Dixon officials talking about how the city’s dump trucks had holes in them and how the local public cemetery went unmowed as Crundwell built up a herd of 400 or so horses.

“She spared no expense taking care of them, which was easy to do since it wasn’t her money she was using to do it,” Pedersen said.

Pedersen will be featured on tonight’s episode of CNBC’s “American Greed,” which airs at 8 p.m. Promotional materials for the episode dub Crundwell “the cunning cowgirl crook” and describe how she was “thrown off her high horse” when her two-decades-old embezzlement scheme was discovered.

By Monday afternoon, Pedersen said he hadn’t watched much of the promotional video and was unsure how accurate the episode’s portrayal would be. He prosecuted three murder cases in DeKalb County before becoming a federal prosecutor in Rockford in mid-2002, but Crundwell’s case was markedly different from most of the big cases in his career.

“One of the things we didn’t realize as we were doing the investigation initially is how tight-knit that horse community is,” Pedersen said. “We had to be careful with our investigation before she was arrested so she wasn’t alerted.”

The day Crundwell was arrested, authorities searched her home in Dixon and discovered she had kept records of the embezzlement dating to December 1990 – far longer than the bank involved had, Pedersen said.

“She started out small, taking small amounts from the city and gradually worked her way up to larger amounts,” he said.

Crundwell never publicly stated why she did it, but perhaps her purchases speak for themselves. She had, among other things, a nationally renowned herd of 400 quarter horses, a ranch in Dixon, a vacation home in Florida, luxury cars and a motor home, furs, and jewelry.

As the case itself unfolded, Pedersen said, he struggled to believe it had actually happened. Crundwell started working for the city in 1967 as a high-schooler, and city leaders trusted her entirely.

“Everyone, to a person, thought she was great,” Pedersen said.

Perhaps Crundwell’s legacy, despite flashy TV shows and because of people like Pedersen, will be less cowgirl crook and more community caution. No matter how small the town or how long-standing the leader, public scrutiny of public funds and public decisions is vital.

“As a result of this case,” Pedersen said, “I think a lot of these other smaller communities have taken a closer look at their finances.”

• Jillian Duchnowski is the Daily Chronicle’s news editor. Reach her at 815-756-4841, ext. 2221, email her at jduchnowski@shawmedia.com, and follow her on Twitter @jillianduch.

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