SACRAMENTO (CBS13) - A 53-year-old Citrus Heights woman was arrested on Thursday and charged with stealing $1.7 million from her employer over a four-year period when she worked as a bookkeeper for an insurance firm.

Kathe Rascher was charged with 12 counts of mail fraud and five counts of tax evasion by a federal grand jury in Sacramento, U.S. Attorney Benjamin B. Wagner announced.

According to the indictment, Rascher, a bookkeeper for River Valley Insurance Associates Inc., defrauded her employer of more than $1.7 million and evaded paying income taxes owed to the Internal Revenue Service for the tax years 2004 – 2008.

The indictment alleges that Rascher wrote checks to herself and her family members from the River Valley bank account. In order to make it look like the checks were issued for legitimate expenses, she changed the name of the payees on the unauthorized checks in the accounting records, altered carbon copies of the checks, and created fictitious invoices.

She also allegedly reviewed the monthly bank statements and cancelled checks sent to River Valley and deliberately removed and destroyed any returned unauthorized checks that had been issued to her and her family.

The indictment also alleges that Rascher did not disclose the embezzled income obtained from River Valley on her federal tax returns for tax years 2004 and 2005 and did not file federal tax returns for tax years 2006, 2007 and 2008.

If convicted, Rascher faces a maximum statutory sentence of 20 years in prison for each count of mail fraud and a fine of twice the gain or loss. The maximum statutory sentence for each count of tax evasion is five years in prison and a $500,000 fine.

Her arraignment was scheduled for Thursday afternoon.