A former Volunteer Energy Cooperative accountant who pleaded guilty in October to embezzling nearly $1 million from his employer was sentenced Wednesday to 17 years in prison and ordered to repay the money.
Jason Timothy Kittle, 46, of Athens, Tennessee, was facing a 15-to-25-year sentence for a felony charge of theft over $250,000, Assistant District Attorney Robert Edwards said Thursday in a phone interview.
Kittle pleaded guilty Oct. 3, the day his trial was set to begin in Roane County before Judge Mike Pemberton. The cooperative serves all Meigs County residents but only a tiny portion of Roane County's residents, so the jury pool didn't include anyone from that small area, according to prosecutors.
Kittle's lawyer, Cleveland, Tennessee, attorney David Calfee, didn't immediately return a call Thursday seeking comment. Kittle has a right to appeal the sentence Pemberton handed down Wednesday, Edwards said.
Kittle's arrest stemmed from a Tennessee Comptroller's investigation launched in 2018 that found he stole almost $995,000 during a period of more than six years while working for the cooperative, according to the state agency. The theft occurred between June 2011 and December 2017.
After sentencing, Kittle was taken into custody and transferred to the Roane County Jail, then to the Meigs County Jail to await transfer to the Tennessee Department of Correction, Edwards said.
"The judge sentenced him to 17 years as a range 1 offender. That means 30% of his sentence must be served before he's eligible for release," Edwards said. "The judge awarded $981,981 in restitution."
Edwards said the amount of restitution was reduced because the cooperative had stopped payment and collected Kittle's unpaid leave time when he was fired, which totaled $13,000. The order requires Kittle to pay the cooperative's insurance company that covered the loss, he said.
According to the Comptroller's Office, Kittle, over six-and-a-half years, stole $735,318 by making 242 transfers from a cooperative account to his personal bank account. Another $229,293 was taken by making 204 payments to his personal credit card account and an additional $30,368 was taken by making 48 payments to his wife's credit card account.
Kittle concealed his thefts by recording the fraudulent transactions in the cooperative's accounting system as online payment fees, returns or similar transactions, according to the Comptroller's Office. He also managed and reconciled the statements of the cooperative's bank account, which allowed the theft to remain undetected for years.
Kittle was fired Jan. 2, 2018.
The nonprofit utility's vice president of accounting, Mark Verstynen, testified during Wednesday's hearing about the amount of damage done, the means by which it was done and the timeframe, according to Edwards. In a separate victim's statement, Verstynen told to the judge how the theft affected the cooperative's thousands of customers as well as himself during a period of time when his family was dealing with a tragic death.
Kittle also testified Wednesday, Edwards said.
"He said that this started in late 2011 because a judge threatened to put him in jail over unpaid alimony and obligations stemming from a divorce in the amount of $5,000," Edwards said.
Edwards said the amount stolen amounts to about $142,000 a year, over $12,000 a month.
"His salary when he started in 2011 was $32,500," Edwards said.
Edwards said Kittle's sentence was harsher than the minimum penalty of 15 years because of the amount of money Kittle took.
"The scheme that he used involved transferring money directly from a VEC account to his personal checking account," Edwards said. "There was an accounting glitch in the software that was found and corrected in the middle of the scheme, and when that happened he switched to making payments directly from the VEC account to his personal credit card and his wife's credit card. That's why it got caught -- because those transactions got flagged."
The transactions he made to his personal account were made to look like refunds to customers, according to a statement issued Wednesday by District Attorney Russell Johnson. Kittle's theft was first reported to the Decatur Police Department.
"When the theft was initially reported, neither VEC nor law enforcement knew the entire breadth and depth of the theft," Johnson said in the statement. "After he stole the first sum of money, he intended to put it back, but when he realized he could not put it back without triggering red flags he decided he was going to get caught eventually so he should continue the theft."
The state comptroller in 2018 was Justin P. Wilson.
"This is one of the largest cases of theft that we have investigated," Wilson said at the conclusion of the investigation in November 2018.
On Thursday, the nonprofit utility issued a brief statement acknowledging Kittle's 17-year sentence and the steps taken to avoid such problems in the future.
"VEC management regrets that the theft occurred but is satisfied that justice has been served," the cooperative's vice president of marketing and economic development, David Murphy, said in the statement. "Measures have been instituted at VEC to assure a theft incident cannot happen again."
VOLUNTEER ENERGY COOPERATIVE
Created in the 1930s, the nonprofit Volunteer Energy Cooperative serves more than 115,900 customers in Tennessee, with more than 10,000 miles of power lines stretching from Georgia to the Kentucky border, according to the cooperative’s website. Its service area includes all or portions of Bledsoe, Bradley, Cumberland, Fentress, Hamilton, Loudon, McMinn, Meigs, Morgan, Overton, Pickett, Polk, Putnam, Roane, Rhea, Scott and White counties.
Contact Ben Benton at bbenton@timesfreepress.com or 423-757-6569.