Inspector General's office files 40 felony counts in alleged DCS scam

INDIANAPOLIS - The Indiana Inspector General's office has filed charges against four people accused of defrauding the Department of Child Services.

Defendants Michelle Milbourn, Tessa Rooney, Kathleen White and Andrea Brown together face more than 40 felony counts stemming from an alleged scheme to receive false child support money.

In a probable cause affidavit released Thursday, inspectors allege Milbourn used her position as an exceptions processor and returned deposit item clerk for Xerox to post fraudulent funds into her own child support account. Xerox is a contractor for the Indiana State Central Collection Unit (INSCCU) -- where Milbourn worked -- which is responsible for receiving and disbursing child support payments.

According to the affidavit, Milbourn conspired with three people to exchange money for checks written to her child support account, "… knowing she would receive the money and that the payer would not be responsible for the amounts written."

The computer system used by INSCCU automatically posts payments below $5,000 to child support accounts before they are validated by a bank, according to the affidavit. Inspectors say Milbourn used this knowledge, and her position as the only person responsible for cases flagged for financial review, to bilk the federal government out of $34,824 worth of fraudulent child support payments.

A spokesman for the Department of Child Services said they were first alerted to possible fraudulent activity during routine monitoring.

"Once the [Office of the Inspector General] investigated the situation, DCS worked with [Xerox] to tighten the system to ensure it can no longer be manipulated in this manner," said James Wide, director of communications for DCS.

Xerox has reimbursed DCS for the full amount attributable to alleged forgeries by Milbourn and her co-defendants, according to the affidavit.

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