Stealing From Nuns May Cost More Than Penance

(CN) - An Orange County woman was arraigned Tuesday on charges that she stole $285,000 in retirement savings from a group of Roman Catholic nuns in a phony real estate deal, and then spent the money on clothes, pet sitters and rehab.

Linda Rose Gagon, of Tustin, Calf., surrendered herself to the FBI Monday on three counts of wire fraud in connection with a scheme to defraud the U.S. Province of the Religious of Jesus and Mary Inc., whose boarding school Gagon had previously attended.

A federal grand jury indicted Gagon last week, charging the 57-year-old with creating a fake company, Rose Enterprise Inc., to assist the nuns with the purchase of a residence in San Diego, Calif.

Gagon learned that the nuns wanted to buy the property when she visited their Rohde Island convent, according to the indictment released by the California District Attorney's Office.

Claiming to specialize in real estate, Gagon convinced the nuns to send her $285,000 of their retirement money to purchase the San Diego property, prosecutors say.

However, "neither defendant Gagon nor Rose Enterprise ever held a real estate broker license or real estate agent license issued by the State of California," according to the indictment.

Instead of purchasing the property, Gagon spent the money on herself, the indictment alleges, including "$2,450 in pet-sitting services; $217 for salon/nail services; $448 for lingerie; $32,575 in mortgage payments; $5,400 in rental payments; $1,523 in car payments; $39,865 in withdrawals of cash or cash equivalents; tens of thousands of dollars to pay employees of Rose Enterprise, including $4,203 to defendant Gagon's daughter, A.W."

Gagon also allegedly spent the nuns' money on purchases at "Nordstrom, Costco, Orange Canyon Pet Clinic, grocery stores, other retail outlets, credit card payments, pharmaceutical drugs, life insurance premiums, and rehabilitation services," the indictment states.

After the nuns became suspicious and tried to get their money back, Gagon told them the money was tied up in escrow and requested an additional $285,000 to close the deal, the indictment states.

If convicted, Gagon faces up to 60 years in federal prison.

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