Former Cusick clerk pleads guilty to stealing $195,000

NEWPORT – Former Town of Cusick clerk and councilmember Luke Michael Servas, 38, pleaded guilty to a single count of bank fraud in U.S. District Court Wednesday, Aug. 14. Servas admitted to embezzling more than $195,000 between October 2022 and March 2023, and trying to blame it on the late Duane Schofield, who was Cusick Mayor at the time, according to the plea agreement.

Fifty other charges were dropped in exchange for the plea.

Sentencing is set for Nov. 13 in Spokane. According to the plea arrangement, Servas will serve no more than the 30-year maximum. While prosecutors will recommend a prison sentence, not probation, they say that the recommendation will be well below the 30-year statutory maximum. The judge will decide at sentencing based on a pre-sentence investigation.

The plea deal details how Servas stole nearly $200,000 from the Town of Cusick. The loss was discovered in March 2023. When public officials expressed concerns about the missing money, March 7, 2023, Servas contacted the Pend Oreille County Sheriff’s Office to report that between $150,000 and $200,000 had been stolen from the town’s bank account. According to the plea agreement, Servas said the money had been stolen using Scofield’s town credit card and that only Schofield had access to the card.

According to the plea agreement, in October 2022, Servas used his position as town clerk to steal Schofield’s town credit card by intercepting it in the mail. Servas and Schofield had two STCU town credit cards in their names. Schofield died April 29 this year at age 76 following a lengthy illness.

Servas then transferred town money to Schofield’s town credit card and used Schofield’s card “… to make hundreds of transfers to two PayPal accounts …” one owned by Servas and one owned by his wife, Afton Servas, who still sets on the Cusick Town Council. The plea agreement refers several times to Servas’s spouse, but doesn’t name Afton Servas. According to the plea deal, Luke Servas fraudulently stole $174,227 that way. Servas stole another $10,559 by transferring town money from the town’s STCU account to his town credit card, then making PayPal purchases on his own account. He stole at least another $5,966 by transferring town money to his town credit card to buy crypto, according to the plea deal.

On March 10, 2023, three days after Servas called the Sheriff’s Office to falsely say that only Schofield could have transferred the money, according to the plea agreement, Servas forged the signatures of Schofield and council member Everet Alford on a $4,961 Town of Cusick check made out to Servas. He cashed the check March 20.

“Mr. Servas not only carried out a fraudulent scheme to rob a town of its financial resources, but when his colleagues noticed the money missing, Mr. Servas filed a report with law enforcement to hide his theft,” U.S. Attorney Vanessa Waldref said in a press release.

Servas was appointed to the Cusick Town Council in August 2022, then ran for election in November 2023, where he lost.

“Mr. Servas took these actions while an elected public official with a moral duty and legal obligation to protect that money,” Waldref said. “Our communities trust elected officials to serve others, rather than to look after only their own self-interest. When elected officials abuse this trust by committing theft and lining their own pockets with taxpayer money, these officials devastate our communities and undermine our democratic system of government.”

Waldref said her office would continue to expose and prosecute public corruption, self-dealing and fraud. She praised the FBI and the state Auditor’s Office for their work.

Richard A. Collodi, Special Agent in Charge of the FBI’s Seattle field office, said a small town like Cusick could have used the money that Servas embezzled.

“Even more disturbing, Mr. Servas served in a position of trust as the Town Clerk when he committed his fraud. Investigating the corruption of public officials remains one the FBI’s most important priorities,” Collodi said.

According to a state Auditor’s report, in September 2022, the town’s clerk treasurer resigned and the council agreed to appoint Servas as the new clerk treasurer.

In October 2022, the state auditor’s office started a regularly scheduled accountability audit.

Between October 2022 and February 2023, the state auditor’s office made multiple requests to the clerk treasurer for the town’s records. “He provided none,” the report said.

Because the clerk-treasurer didn’t provide records to the auditor or the town council, two councilmembers went to the bank to get a transaction summary.

“The summary showed an account balance on August 1, 2022, of $233,822 and by March 7, 2023, it had a balance of only $249,” the report said.