Former Twin Cities executive pleads guilty to embezzling $3M to fund lavish lifestyle

A former Twin Cities property management executive has admitted to embezzling more than $3 million from his employer to fund a lavish lifestyle.

David E. Katz pleaded guilty in U.S. District Court in St. Paul to wire fraud in connection with the embezzlement while he was the chief financial officer for Durand and Associates (D&A) in South St. Paul from 2012 to until his firing in 2017.

D&A specialized providing homeowner association services that included lawn care, snow removal and building services in exchange for a monthly fee.

The plea agreement says that federal guidelines call for him to receive a sentence ranging from 2 ³⁄₄ to nearly 3 ¹⁄₂ years. However, federal judges have discretion when sentencing defendants and are not bound by the guidelines.

The plea deal also calls for Katz to pay back the $3 million he stole.

Sentencing for Katz, who now lives in Arizona, has yet to be scheduled.

According to prosecutors:

Katz worked for D&A from approximately 1998 to 2017, starting as an accountant and eventually becoming CFO, giving him authorization to open credit cards in the company's name and use those credit cards for business expenses.

Between 2011 and 2017, Katz paid himself $6,500 every two weeks as a salary despite his agreed upon annual salary never being more than $47,500.

He also reimbursed himself for personal expenses and for business expenses he never actually incurred. Those reimbursements ranged between $6,000 and $10,000 every two weeks. He labeled these payments as miscellaneous earnings and reimbursements, "recovery loans," bonuses and commissions.

Katz used company credit cards to pay for personal travel expenses, jewelry, designer clothes, golf, groceries, concert tickets and his residential utility bills.