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City of Seattle
Ed Murray, Mayor

SUBJECT: City's case against Joe Phan draws closer to conclusion

1/17/2014  4:00:00 PM
Kimberly Mills  (206) 684-8602

The City’s involvement in the criminal and civil cases against Joseph Phan, who embezzled more than $1 million from Seattle Public Utilities (SPU), edged closer to conclusion Friday when King County Superior Court Judge Catherine Shaffer sentenced Phan to 90 months in prison, the prosecutor's recommendation.

“I’m proud of the hard work of our assistant city attorneys in recovering ratepayer assets, which wouldn’t have been possible without the full cooperation and assistance of SPU and Director Ray Hoffman,” City Attorney Pete Holmes said.

A little over a year after the former SPU engineer was charged with diverting the money from water-main-extension projects into a private bank account, the City had been made whole. Roughly half of the money came from the city’s insurance firm, Zurich, while the remainder was recovered by seizing Phan’s bank accounts, real estate, a retirement account, a college fund and personal property.

At the sentencing, Hoffman told the judge of the serious impact Phan’s deceit had on SPU customers and employees alike. The discovery of one of the largest embezzlements in Seattle history also sparked thorough reviews and changes in SPU accounting practices. Phan was fired in 2011 when internal audits found that he had accessed his own city utility account to record payments for his home and a rental property totaling more than $1,000 when none had been made.

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