Former Kansas mayor, bank manager sentenced for decade-plus embezzlement scheme.

KANSAS CITY, Mo. — A federal judge sentenced a former Kansas mayor and credit union manager to five years and three months in prison for a decade-plus embezzlement scheme.

According to court documents, 71-year-old Rita Hartman of Atchison, Kansas, pleaded guilty to one count of false entries in federal credit union records.

For 30 years, Hartman was the manager of Muddy River Credit Union (formerly Atchison Casting Credit Union and Bradken Federal Credit Union), which served the employees of a foundry located in Atchison. Hartman's position gave her control over all aspects of Muddy River's finances.

Between 2007 and 2021, she stole approximately $346,00 in customer cash deposits. Hartman also fraudulently credited approximately $430,000 in deposits and loan payments to her or her relatives' accounts when no payments or deposits had been made. In total, she stole more than $750,000 from her long-time employer.

Hartman concealed her actions by altering ledgers and records and by falsifying information submitted to Muddy River's regulators. She also obstructed efforts to uncover her fraud—by submitting fraudulent documents to regulators and delaying a mandated audit.

Her embezzlement wiped out Muddy River's capital and rendered it insolvent, ultimately forcing a merger into another credit union to continue operations.

In 2013, the then-Governor of the State of Kansas appointed Hartman to the Kansas Credit Union Council, which advises the Kansas Department of Credit Unions on issues and needs of credit unions, according to the Department of Justice. Hartman is also a former mayor and city commissioner in Atchison.

A federal judge ordered that during her imprisonment, all of Hartman's state pension payments be directed toward the $778,361 in restitution she was ordered to pay as part of her sentence.

"For decades, Rita Hartman was a prominent, well-respected figure in Atchison, Kansas," said U.S. Attorney Ryan A. Kriegshauser. "Instead of living up to the high regard that people in the community had for her, she exploited their trust and used it to perpetuate her embezzlement scheme and line her pockets with stolen funds."