A Max woman faces a felony theft charge for allegedly taking more than $47,000 from the Max School District.

LeaRae Hackett was arrested and charged Thursday for Class B felony theft, McLean County State's Attorney Ladd Erickson said. He said Hackett is slated to appear at a bond hearing at 1:30 p.m. today.

According to court documents, Hackett had been the business manager for the Max School District until she resigned on Oct. 3. Documents say Hackett was responsible for paying bills by preparing checks, stamping them with the board president's signature and signing them herself. She also processed and recorded the payroll, prepared receipts, and made deposits for the school's general fund.

An audit of the school district from Oct. 16, 2006, through Oct. 15, 2008, performed by the state auditor's office, revealed that $47,812.03 appeared to have been misappropriated by Hackett. A letter from State Auditor Robert Peterson to the state Insurance Department on Nov. 13 said auditors are questioning $41,319.31 in unauthorized checks issued by Hackett to herself, $2,262.56 in unsupported direct deposits she made into her personal account, $2,241.60 in checks written to Bremer Bank and cashed by her, and $1,988.56 for a computer and accessories paid with school funds and shipped to Hackett's home.

According to documents, the school board president received a phone call from Bremer Bank on Sept. 24 about three checks written to the bank, totaling $6,828, which had been cashed by Hackett. On Oct. 1, the school superintendent confronted Hackett about the checks, and she said they were to pay an overdue bill with a money order. She later recanted and said she wired the money from Western Union to pay the bill. Hackett was unable to immediately produce an invoice or a deposit slip for the remainder of the money over the invoice amount.

The next day, she produced an invoice dated Aug. 8, 2007, which the superintendent later learned actually had been paid on Nov. 19, 2007, documents said. She again was asked about the extra money over the amount of the invoice being deposited, and she said to look in a drawer in a vault, which had not previously been used to store money. The money was in the vault, documents said.

"It is presumed … LeaRae brought the money in that morning and placed it in the drawer," Bureau of Criminal Investigation Special Agent Tom Dahl wrote in an affidavit.

Hackett resigned the next day, and school officials began an audit of bank statements and cancelled checks. An auditor made a record of all cancelled checks made out to Hackett from July 1, 2004, to June 30, 2008.

"He compiled a list of cancelled checks that were missing from the bank statement and received copies from Bremer Bank," Dahl wrote. "Most of the missing checks were made payable to LeaRae Hackett."

Auditors also compared the missing checks to a computer check listing, maintained and entered by Hackett, and noticed that most of the missing checks were not entered or were entered with a vendor name rather than that they had been made out to Hackett.

BCI investigators replicated the auditors' work and determined which checks were legitimate payroll checks by comparing the checks to the payroll register, documents said. Besides payroll checks, the investigators also found three other checks written to Hackett that were for legitimate purposes.

"The remainder of the checks did not have support," Dahl wrote.

He wrote that investigators also learned Hackett had ordered a Dell computer with a school credit card on Dec. 7, 2007. The computer was shipped to Hackett's home, documents said. No one at the school had seen the computer, and the school does not use Dell computers, documents said. Erickson said a search warrant was served at Hackett's home on Thursday, and court documents said a computer matching the Dell's description was found and seized.

If convicted, Hackett could face up to 10 years in prison and fines of up to $10,000.

(Reach reporter Jenny Michael at 250-8225 or jenny.michael@;bismarcktribune.com.)