Sentence delayed

ANCHORAGE — While prosecutors are recommending 30 days in jail and a fine, the second Matanuska Creamery executive to be convicted of financial crimes in the wake of the business’ collapse said she believes neither is necessary.

Karen Olson — who was in charge of the creamery when it collapsed in 2013 under a pile of state debt leaving behind equipment, trucks and a trailer full of moldy cheese — is scheduled to be sentenced Nov. 12.

“What real justification is there to send a 70-year-old woman to jail when she did not physically harm someone? When her fraud was minimal and was motivated to keep the dairy running? There is none,” Olson’s attorney, Steven Wells, writes in a memorandum filed with the court Oct. 17.

The story of the creamery was replayed in exhaustive detail in court. Founded in 2007 at around the same time that the big, state-run Matanuska Maid dairy was collapsing, the dairy produced fluid milk, cheese and ice cream up until it fell apart. The dairy used some of the same equipment that Mat Maid had.

Kyle Beus, who ran the creamery for most of its short life and at one point was a co-owner before he was pushed out, was sentenced in May to two months in jail for fraud. Prosecutors had only asked for one month.

Olson was charged after Beus and took her case to trial rather than accept a plea, like Beus had. She was convicted of making false statements and covering up a felony but acquitted of mail fraud July 30.

In prior filings in court, Olson argued that because she was acquitted of mail fraud she should also have been acquitted of the other charges, arguing — among other things — that if she was not guilty of committing mail fraud the jury must have decided that she was acting in good faith in her financial dealings at the creamery. If she was acting in good faith she therefore couldn’t have made a false statement — at least not one she knew was false — and covered up a felony.

U.S. District Court Judge Tim Burgess slapped down that argument, saying that there was ample evidence the jury used to convict her and that whether or not it chose to convict her of mail fraud was immaterial.

Prosecutors’ reasons for asking for a 30-day sentence for Olson remain opaque — they are contained in a pre-sentence report that was not made available to the public in online court records — but earlier filings show them strongly fighting back against any notion that Olson’s sole motivation was to “keep the dairy running” — especially when it comes to covering up for Beus.

“Olson had a personal interest in... the success of the Valley Dairy and did not want the financial difficulties caused by Beus to impact the dairy. If successful, she stood to receive 50 percent of the profits. She needed the Valley Dairy to survive, even at taxpayer expense,” writes prosecutor Retta-Rae Randall.

Contact Andrew Wellner at 352-2270 or andrew.wellner@frontiersman.com.