Md. Woman Pleads Guilty to Aiding Scam

Defendant Admits Cashing Millions of Dollars' Worth of Fraudulent Checks

A 73-year-old Maryland woman implicated in the D.C. tax scandal pleaded guilty yesterday to federal charges that she helped carry out a fraud that cost the District tens of millions of dollars.

Patricia A. Steven, whose husband pleaded guilty last month in the case, admitted in court that she cashed millions of dollars in checks fraudulently issued by the D.C. Office of Tax and Revenue.

Steven is the eighth person to plead guilty in the scandal, which came to light last year and which siphoned as much as $50 million from the D.C. government. Four others are awaiting trial, including the alleged mastermind of the scam, former D.C. tax manager Harriette Walters.

At the federal courthouse in Greenbelt, Steven seemed alert but frail as she appeared before U.S. District Judge Alexander Williams Jr., who allowed her to remain seated while she took her oath. Sitting next to her lawyer, Michael Lawlor, and with a cane at her side, Steven catalogued her back and hip ailments and the medication she is taking for them.

She told the judge that she is fine mentally but not physically. "I'm in a lot of pain," she said.

At one point, the hearing was stopped to allow Steven to take asthma medication.

Steven has known Walters since the mid-1970s, according to court documents filed yesterday. The criminal activity began in the late 1980s, when Walters proposed that Steven deposit a D.C. government check. The check was payable to Steven, who knew it was fraudulent, according to the documents.

Steven deposited the check in a deal to keep some of the money for herself, with the rest going to Walters, according to the court papers. The arrangement continued for 16 years, involving dozens of checks and totaling almost $9 million, the court documents stated.

Using the money, Patricia Steven and her husband, Robert, purchased two Maryland houses, one in Edgewater and one in Harwood; four Jaguar vehicles; tropical vacations; and jewelry worth more than $150,000, according to court documents.

After answering the judge's questions, Steven listened to one of the prosecutors, Assistant U.S. Attorney Jonathan C. Tsu, outline the government's account of her crimes. Asked by the judge whether the allegations were true, Steven said they were. Asked whether she wanted to plead guilty, Steven said she did.

Charged in court papers filed Friday with one count of possession of stolen property and one count of conspiracy to commit money laundering, Steven faces up to 10 years in prison on the first charge and 20 on the second.

She is scheduled to be sentenced Nov. 10 and was allowed to remain free until then.

As part of her plea agreement, Steven agreed to forfeit any property that can be traced to the money laundering, including the houses, the cars and other valuables. Prosecutors are seeking $8.3 million from Steven for her part in the scam.

In court papers filed in connection with Robert Steven's plea, the government said Patricia Steven deceived her husband about her financial dealings and other aspects of her life, including her age. But Robert Steven spent large sums of the millions of dollars flowing into the couple's bank accounts, according to prosecutors. Authorities have said that Robert and Patricia Steven are estranged.

Leaving the courtroom, Steven turned away when asked whether she had any comment. But when asked whether she and her husband had separated, she snapped, "No," before stepping into the elevator.