Latest Legal News from the Criminal Courts in Houston, Texas

May 8, 2007

Two Indicted in Shelby County Indigent Fund Theft

Former county official, daughter-in-law charged in scheme to steal $190,000

CENTER – In a case co-prosecuted by Texas Attorney General Greg Abbott’s office, a Shelby County grand jury has returned second-degree felony indictments against a former Shelby County assistant auditor and her daughter-in-law for diverting more than $190,000 from the county’s indigent health care fund. Marilyn Lout, 70, of Shelbyville, and Kimberly Lout, 43, of Warren in Tyler County were indicted for theft and misapplication of fiduciary property.

The Attorney General today filed a forfeiture action on behalf of Shelby County to protect the stolen funds. Investigators with the Office of Attorney General seized those funds on April 24. Today’s filing seeks court approval for the forfeiture of nearly $130,000 held in Hardin County bank accounts assigned to Kimberly Lout and other family members. The Attorney General’s Office is also attempting to recover an additional $64,000 in diverted funds that were stolen.

Texans will not tolerate government officials who steal from taxpayers and violate the public trust,” said Attorney General Abbott. “The Office of Attorney General will aggressively prosecute the perpetrators of this outrageous scheme to defraud Shelby County’s Indigent Health Care Fund. We are grateful to Shelby County District Attorney Lynda K. Russell for her office’s tremendous assistance with this case.”

As assistant county auditor, Marilyn Lout was responsible for administering the Shelby County Indigent Health Care Fund. Following an audit by the subsequent Shelby County Auditor, county investigators traced missing public funds to bank accounts in Hardin County, south of Center.

According to documents filed by the Attorney General, Marilyn Lout falsified invoices billing the county for medical treatments provided to the indigent. While the treating physicians were properly paid from the fund for services rendered, Marilyn Lout reproduced the invoices, inflated the amount owed and issued checks written to her relative. Those checks were imprinted with official auditor’s and treasurer’s stamps. Ranging in amounts between $1,500 and $10,000, the checks were ultimately diverted to Kimberly Lout, who deposited them into her personal accounts in Hardin County.

Because Marilyn Lout was previously a county employee, Shelby County District Attorney Russell requested the Attorney General’s assistance with the case

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