California Catholic School Nuns Allegedly Embezzled $500,000 for Las Vegas Gambling Trips

A statement by St. James Catholic School in Torrance alleges the nuns were "involved in the personal use of a substantial amount of school funds" for years

Nuns Embezzle Money from St. James Catholic School In Torrance
Photo: Scott Varley/Digital First Media/ Torrance Daily Breeze/Getty

Two California nuns are accused of embezzling approximately $500,000 in tuition payments and donations from the California high school at which they worked — and, according to local reports, they allegedly used the money to fund gambling trips to Las Vegas.

The scandal first came to light last week, when officials at St. James Catholic School in Torrance informed parents that Sister Mary Margaret Kreuper and Sister Lana Chang allegedly had been “involved in the personal use of a substantial amount of school funds,” a statement from St. James Catholic Church obtained by PEOPLE says.

Kreuper was the school’s principal and Chang taught there, according to the Southern California News Group. PEOPLE was unable to reach either of the accused for comment.

The outlet obtained audio from a two-hour meeting held earlier this week at the church in Redondo Beach, where the Archdiocese of Los Angeles discussed the allegations with parents and school alumni.

At the meeting, archdiocese officials said they would not be pursuing criminal charges against the women, who retired earlier this year from the school and allegedly expressed remorse for their actions. According to local media reports, parents at the school were angry with the decision and the outcry compelled the archdiocese to reverse course.

Sgt. Ronald Harris of the Torrance Police Department told the Southern California News Group that archdiocese officials met with police last Thursday.

“They indicated they were desirous of pressing charges, so we’re moving forward as soon as we formally meet with them again,” Harris told the outlet.

PEOPLE was unable to reach the Torrance Police Department.

Before the archdiocese indicated its support for the filing of charges, Jack Alexander of Redondo Beach told the outlet that turning the other cheek sent the wrong message.

“We were an ATM and people know it and [the archdiocese] won’t ask for justice,” Alexander said.

Archdiocese Initially Planned to Handle Accusations Internally

The pair allegedly carried out the scheme “over a period of years,” the church’s statement says.

According to the statement, dated Nov. 28, church officials initially planned to handle the matter internally.

“The Sisters’ Order, the Sisters of St. Joseph of Carondelet, is cooperating with us and the Archdiocese to confirm the amount of the funds that were misappropriated,” the statement says. “The Order has agreed to arrange for full restitution for the benefit of the School of the funds that are found to have been misappropriated and is imposing appropriate penalties and sanctions on each of the Sisters in accordance with the policies of the Order.”

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The nearly $500,000 the nuns allegedly spent on trips to casinos may just be the tip of the iceberg, according to the Southern California News Group. Auditors hired by the school six months ago to do a forensic accounting have only been able to trace bank records from the past six years.

The auditors were hired months after a standard review of the school’s finances — conducted ahead of Kreuper’s retirement — revealed a check to the school had been deposited to another bank account, the outlet reports.

A tip was also phoned into an ethics hotline maintained by the archdiocese.

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