Marshals take over Rita Crundwell’s property, horses

ROCKFORD – Wearing what appeared to be the same butterfly bejeweled clip and shiny beige trench coat, Rita A. Crundwell did not object to the U.S. Marshals Service taking over her Dixon ranch.

The former Dixon comptroller is accused of misappropriating $53 million in city funds throughout more than two decades to pay for what prosecutors are calling her “lavish lifestyle,” including caring for more than 300 horses and buying $339,000 in jewelry during the past five years.

The Thursday morning hearing was held to decide whether the U.S. Marshals Service would take over the maintenance of her herd of prime quarter horses, which is scattered across the country. The judge granted the request.

Crundwell is scheduled to be back in court Monday morning, when she likely will enter a plea. She is charged with federal wire fraud, which carries up to 20 years in prison and up to a $250,000 fine, plus restitution.

About two-thirds of her horses are stabled at her ranch on U.S. Route 52 just outside of Dixon.

They have been cared for by her employees and contractors, many of whom have not been paid since her April 17 arrest, assistant U.S. Attorney Joe Pedersen said.

She still is allowed access to the ranch and has been helping inventory the horses, he said.

“All we’re seeking is the authority for the marshals to maintain the horses,” Pedersen said. “My understanding is that they are very valuable, but if they’re not maintained and trained, they quickly lose value.”

Since U.S. District Court Judge Philip Reinhard granted a temporary injunction Tuesday, the U.S. Marshals Office was able to access emergency funds and has established contracts of their own with the various employees and contractors to pay them, the attorney said.

The restraining orders, which prevent Crundwell from selling or otherwise “devaluing” her property will remain in place until further court action, Reinhard ruled.

Prosecutors hope to sell the horses, with their value being held by the government until or if a conviction is reached, Pedersen said, adding the Marshals Service will be soliciting bids on an auction contract.

Pedersen could not comment on how much the maintenance will cost or give a time frame on when a sale would happen. A judge first must grant the marshals authority to sell the horses, he said.

Crundwell’s federal public defender, Paul Gaziano, will represent Crundwell in the civil lawsuit filed by the U.S. Attorney’s Office, the judge ruled. The suit, which named her horses but not her, is part of the process needed to gain official control of the herd so it can be sold.

Gaziano declined Thursday to comment on the case.