Binion’s embezzler gets two years in prison

Bill Gang

Wednesday, Oct. 13, 1999 | 10:49 a.m.

The slot booth cashier who walked off with more than $1 million from her job at Binion's Horseshoe hotel-casino has been sent to prison for a minimum of two years.

Rita Kolstad emotionally told District Judge Sally Loehrer, "I just want to get on with my life," but the judge said Tuesday that the "life" was going to involve prison time and then she would still have to repay $290,000 that she stole.

Minutes later, as she sat in handcuffs, Kolstad casually joked with other prisoners.

From September 1995 through May 1997, Kolstad pilfered 23 percent of the cash that passed through her booth and used part of it to put a down payment on a house, buy a sport utility vehicle and establish trust funds for her children.

The rest of the funds, pocketed on 278 occasions, were used for living expenses and gambling or were invested in her boyfriend's business, said Deputy District Attorney Valerie Adair.

No one caught on until there was an unusual in-depth audit, Adair said.

Kolstad pleaded guilty in July to five counts of theft and was facing a maximum sentence of six to 15 years in prison -- although probation also was an option. Adair said the scam was simple and was facilitated by the inability of the accounting procedures in place at the time to detect the losses.

Kolstad simply pocketed cash and destroyed money transfer and credit clips that recorded the purchase of coins from her change booth. Since the remaining cash and documents balanced, internal bookkeepers were unaware of the losses, the prosecutor said.

There were duplicate documents generated at the time of the original transactions, but they went into a different bookkeeping system and the bottom line figures -- which would have revealed the embezzlement -- simply were never compared, Adair explained.

At the same time, she added, the Horseshoe was in the throes of a family feud over ownership of the downtown club and financial controls were limited.

But once Becky Behnen took over control from Jack Binion of the casino their father, Benny Binion, had founded, a full audit was conducted and the losses were revealed.

While Kolstad pleaded guilty, she did so under a legal provision that does not require her to admit actual responsibility.

Her attorney, Lamond Mills, alleged at an early court hearing that a change person couldn't have been responsible for all the missing money and she was the scapegoat for higher level thieves.

But the evidence showed the funds were stolen only on Kolstad's shift and only on days she was actually at work.

Kolstad wasn't required to make restitution on the entire amount in part because the Horseshoe was reimbursed $750,000 by its insurance company.

Adair said auditors have traced where about $300,000 of the stolen funds went, but what happened to the rest is still unclear.