Rita Crundwell, Dixon Ill. comptroller, stole $30M from city, authorities say

(CBS/AP) CHICAGO - Authorities say a finance officer for Dixon, Illinois, was able to steal a staggering $30 million from government coffers to run a nationally renowned horse breeding business. Dixon's mayor pledged new measures to protect the city's finances a day after FBI agents arrested longtime comptroller Rita Crundwell.

Pictures: Official stole millions to buy horses, say Ill. cops

She is accused of using the money to fund one of the nation's leading horse breeding operations and support a lavish lifestyle that has kept her equipped with cars and hundreds of thousands of dollars worth of jewelry.

A criminal complaint says the siphoning of city funds went undetected for years until another staffer filling in as vacation relief became suspicious and discovered a secret bank account.

The fact that $30 million, much over the city's current annual budget of $20 million, could be stolen without notice left many puzzled.

"Tens of billions of our tax dollars flow through 7,000 plus units of government in Illinois every year. And we can only watch a few of them," said Andy Shaw, president of a Chicago-based corruption watchdog, the Better Government Association. "Most of them don't have inspector generals. Most of them don't have auditor generals. Most of them don't have watchdog groups looking closely. ... It's ripe for rip-offs."

Dixon, a city of about 16,000 people west of Chicago where Ronald Reagan grew up, was especially vulnerable because Crundwell, who has been comptroller since the early 1980s, had control over all of the city's finances. This is a common arrangement in smaller cities and towns.

Federal prosecutors say she stole $3.2 million since last fall alone and misappropriated more than $30 million since 2006.

Between January 2007 and March of this year, she is accused of racking up more than $2.5 million on her personal American Express card - including $339,000 on jewelry - and using Dixon funds to pay back the charges.

Prosecutors say she used $450,000 in stolen funds for operations at her Meri-J Ranch, where she keeps about 150 horses. Crundwell is one of the top horse breeders in the nation.

Crundwell is now free on a $4,500 recognizance bond. A federal judge barred her Wednesday from selling any property while the wire fraud case proceeds and limited her travel to northern Illinois and to Wisconsin where she has her horse ranches.