Robert Due case: Fired Covington finance director due in court to face embezzlement charges

Judge eases freeze on wife's assets

COVINGTON , Ky.  – There were new developments Tuesday in both the criminal and civil cases involving fired Covington Finance Director Robert Due.

Due was fired last month after an investigation allegedly revealed he embezzled an estimated $600,000 in city funds.

Search warrants filed with Kenton District Court indicate that Due gave no excuses for the theft and said he was simply "living above his means."

Detectives seized two Dell computers and numerous documents from his office. One warrant detailed a financial account that had been frozen.

A preliminary hearing in the criminal case was scheduled for Tuesday afternoon, but it was reset for Wednesday because Due was still hospitalized after attempting suicide.

Kenton County Commonwealth's Attorney Rob Sanders raised an issue of where Due would stay once he's out of the hospital.

Due has been electronically monitored at his Independence home instead of being jailed, but Sanders said that's up in the air now.

"There's a question mark about whether the marital relationship has broken down to the point that he's not going to have a residence to be set up on home incarceration," Sanders told Judge Douglas Grothaus.

Tim Schneider, Due's attorney, said he wasn't aware of that possibility.

"At this point, I know of no information that would indicate that the marital relationship has broken down to that extent," Schneider said. "I will certainly be prepared to address that issue tomorrow."

Judge Grothaus said he's more concerned about how that might impact Due's mental health status. He requested information on what outpatient treatment Due is receiving.

Schneider said Due should be out of the hospital around 11 a.m., report directly to home incarceration to get a new bracelet and then appear at the 1:30 p.m. preliminary hearing.

Sanders said nobody in the court system wants to see a defendant harm themselves because of things going on in the courthouse.

"We don't want anything bad to happen to any defendant," he said. "We just want them to be safe and the community to be safe."

An hour later, attorneys representing Covington and Due's wife, Janet Patterson, were in the courtroom of Kenton Circuit Judge Gregory Bartlett.

That's where the city's civil case against Due is being heard. The city is trying to recover as much of the missing money as possible.

The suit claims Due used money taken from the city to buy three cars, pay for a home in Independence and make contributions to retirement and savings accounts.

Judge Bartlett on Friday ordered all assets of Due and his family members to be frozen.

Joe Conley, who represents Patterson, sought a modification of that order to allow her to access an account where the paycheck from her job is deposited.

The judge consented.

"Our goal today was just to free up some assets in the short run so Miss Patterson can pay household living expenses," Conley said. "The couple has gone from two incomes to one in fairly short order."

Brian Redden, representing the City of Covington, didn't object to the change as long as taxpayer dollars are protected.

"We understand that she will continue to have ordinary expenses -- mortgage, grocery bills, gas bill, so on and so forth -- and our job is not to keep her from paying those things," he said. "It's to make sure that the assets that have been accrued don't go anywhere."

Another civil hearing is set for Oct. 2.

The city's lawsuit, filed Friday, alleges that Due deposited the money into his accounts and the accounts of his wife, their children and his late aunt, Virginia Molique, who died in 2012.

The suit also makes claims against auditing firms and banks that failed to detect his alleged scheme as well as companies that provided the city with theft-prevention software and employee-theft insurance.

Due, who was Covington’s finance director since 1999, pleaded not guilty last week to theft, unlawful access to a computer, criminal possession of a forged instrument and official misconduct.

If convicted, he could face 20 years behind bars, according to Sanders.

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