Nine individuals, including one County Public Works accountant, charged in a $1.7 million embezzlement case appeared in court Monday morning, and all now face 27 felony counts of fraud and criminal conspiracy.

The complaint sheet accuses nine defendants -- Lynn Gay Hogan, Wendy Sue Puchli, Michelle Louise Lavin, Richard Edward Kaplinski Jr., Michael Elliott, Christina Huffman and Leanna Yumiko Harada -- of misappropriating public funds, forgery and conspiracy to commit a crime. 

Puchli is from Wyoming, and Richard Kaplinski now resides in Merced. All were arrested last week except for Michael Elliott, of Pennsylvania, according to the District Attorney's Office. An arrest warrant alleging the same charges, has been issued for Elliott. 

Hogan was a senior accountant for the Santa Barbara County Public Works Department and has been employed by the county since 1988, according to a statement released last week by the Santa Barbara County Executive Office. 

Hogan is accused of misappropriating approximately $1.7 million in public funds over the course of nine years between May 27, 2008, and July 25, 2017, according to the complaint.

Hogan allegedly created fake vendor numbers, then issued and deposited fake refund checks to her co-defendants. Her eight co-defendants allegedly received and deposited the false checks, then cashed them into their personal bank accounts over the course of several years. 

The arrests follow several months of investigation by the District Attorney's Office after the County's Auditor-Controller's Office noted suspicious activity in July and attempts to bypass internal control processes. Shortly after, the auditor referred the matter to the District Attorney's Office for further investigation. 

While the precise amount of alleged theft remains under investigation, losses due to employee malfeasance are covered by the county's insurance, according to the county. 

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The county will be working with its insurer on a claim for recovery of funds in an effort to ensure no public funds are lost, according to County Executive Officer Mona Miyasato.

"The county will be ordering a forensic audit by an independent accounting firm and a review of internal controls, financial systems and policies," Miyasato added.

The Auditor's Office and Public Works Department also has been reviewing systems and operations since the alleged fraud was suspected. 

All defendants will return to the Santa Barbara Superior Court for continued arraignment Friday.

Puchli is in custody in Wyoming and will be extradited in time for her arraignment hearing next Monday, according to Deputy District Attorney Brian Cota. Six defendants were placed in custody last week but have been released on their own recognizance by the judge. Kaplinski was released after his arrest due to a medical issue, and an arrest warrant remains out for Elliott.

Gina Kim covers crime and courts for Santa Maria Times. Follow her on Twitter @gina_k210