David Efrem Katz, Wire Fraud, Minnesota 2023

Former CFO Sentenced to Prison for Embezzling Millions

ST. PAUL, Minn. – David Efrem Katz, a former Chief Financial Officer (CFO), has been sentenced to 24 months in prison followed by two years of supervised release and full restitution after embezzling more than $3 million from his employer, announced United States Attorney Andrew M. Luger.

Katz, 56, worked for Durand and Associates (“D&A”), a property management company that specialized in servicing homeowner associations (“HOAs”), from approximately 1998 to 2017. During his tenure, Katz embezzled over $3 million from D&A and its client HOAs.

The scheme began in at least 2012 and continued until 2017. As CFO, Katz had authorization to open credit cards in D&A’s name and use those credit cards for business expenses. However, Katz was not authorized to charge personal expenses to the cards, take out loans on D&A’s behalf without the owner’s approval, or use funds belonging to D&A or its HOA clients to pay his personal expenses.

Katz paid himself significantly more than his agreed-upon salary, approximately $6,500 every two weeks, despite his base salary never exceeding $47,500 annually. He also reimbursed himself for personal expenses and business expenses he never actually incurred, labeling these payments as miscellaneous earnings and reimbursements, “recovery loans,” bonuses, and commissions.

Katz pleaded guilty to one count of wire fraud on June 26, 2023. He was sentenced today in U.S. District Court before Judge Katherine M. Menendez to one count of wire fraud.

The case is the result of an investigation conducted by the FBI. Assistant U.S. Attorneys Matthew S. Ebert and Harry M. Jacobs prosecuted the case.

Durand and Associates suffered significant financial losses as a result of Katz’s actions. The exact amount of restitution Katz must pay was not specified in the press release.

Katz’s sentence serves as a reminder of the consequences of white-collar crimes. The FBI will continue to investigate and prosecute individuals who engage in similar schemes.

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