Former Fagen Inc. CFO admitted to FBI that she embezzled funds

The former chief financial officer of Fagen Inc., a large Granite Falls, Minn., contracting company, has admitted to embezzling at least $4.5 million from the company over seven years, federal authorities said in court documents unsealed Friday.

The FBI and federal prosecutors alleged that Kirsten A. Tjosaas, while first employed as company controller and later as CFO, wrote and signed fraudulent Fagen checks and electronically transferred corporate money to a company she controlled, later shifting funds to her personal bank account.

Tjosaas, who was recently terminated by Fagen after working there since 2004, has not been charged with a crime.

"She is fully cooperating in the investigation," said her attorney, Timothy Webb, who declined to elaborate.

Authorities described the fraud in a U.S. District Court motion to prevent her or her husband, Jeffry, from selling 12 properties, a boat and SUV suspected of having been purchased with fraudulent funds. She agreed on Friday to an extended court order preventing sale of the couple's properties in Minnesota, Florida, Arizona and Tennessee.

Prosecutors acted under a law that allows federal courts to freeze assets in advance of criminal charges. The government took the first steps last week, and unsealed information on Friday.

Fagen is a privately held contractor that built nearly half the nation's 200 ethanol plants. It has constructed wind farms, chemical plants, grain elevators and other major projects across the country.

Company officials could not be reached to comment late Friday.

In late December, according to court papers, Fagen accounting personnel discovered several suspicious transactions to a company with which Fagen had no business dealings. The FBI investigation appears to have moved rapidly after that. Last week, FBI agents interviewed Kirsten Tjosaas in her Granite Falls home, during which she "admitted that she embezzled funds from her former employer Fagen, Inc., by writing fraudulent checks," the government said in the asset-freeze motion.

Kirsten Tjosaas is a certified public accountant who began working in Fagen's accounting department in 2004, and became controller in 2007, and was promoted to CFO in 2013, court papers say. As controller and CFO, she was an authorized signatory on all of Fagen's corporate accounts.

She wrote checks or made transfers in amounts of $100,000 to $400,000 from corporate accounts starting in 2007, posting false entries in Fagen's books, the government said. The stolen money went mainly to a company she and others set up in 2006 to make an ethanol plant investment that apparently never happened, the government said.

Kirsten Tjosaas opened and controlled a bank account for that company, and authorities believe that the stolen Fagen funds were funneled first into it and later into her personal account in a Granite Falls bank, according to court papers.

Staff writer Dan Browning contributed to this story.

David Shaffer • 612-673-7090 • @ShafferStrib