Two Pennsylvania Transit Officials Plead Guilty to Fraud and Theft Charges
On January 8, 2007, Elaine Kost and Lauri Farraro, both former employees of DuFAST Transit Authority, pled guilty in state court in Clearfield, Pennsylvania, to state criminal charges filed in early 2006 by the Clearfield County District Attorney related to the theft of $420,000 of federal and state transit funds from DuFAST. DuFAST Transit provides low–cost transportation service to residents of Dubois and Sandy townships, located outside of Pittsburgh. Kost pleaded guilty to 12 counts of criminal conspiracy, felony theft, and forgery. Farraro pleaded guilty to 13 similar counts.
Between May 2000 and December 2004, Kost and Ferraro falsified board meeting minutes to indicate authorization of bonuses for themselves and reimbursements for various unauthorized expenses, including a Chevy Tahoe sport utility vehicle. Kost received $128,000 in unauthorized bonuses and expense reimbursements. Ferraro received unauthorized bonuses and expense reimbursements totaling $291,000. FTA identified questionable expenses at the authority during its annual financial audit in December 2005 and notified OIG. The Authority received approximately $530,000 in federal funds between 2000 and 2004. This case was investigated with the Pennsylvania State Police and the Clearfield County District Attorneys Office.