Mary Arlene Jurgems-IA

Mary Arlene Jurgems

State of Iowa

Waterloo woman sentenced to prison for $494K fraud case

Kimberly Ann Henny

WATERLOO — Kimberly Ann Henny worked with disabled residents at a nonprofit she started.

Now she is going to prison for allegedly stealing almost half a million dollars from her husband’s elderly aunt, who was blind, had difficulty hearing and suffered from diminished cognitive abilities.

On Friday, Judge C.J. Williams sentenced Henny — who had operated Healing Harvest Ministries, Special Needs Services and Perspectives Behavioral Health — to five years and 10 months in prison on one count of wire fraud in U.S. District Court in Cedar Rapids.

Henny, 53, will be on supervised release for three years following the prison time. She was also ordered to pay $494,724 in restitution.

Court records indicate Henny had power of attorney for the aunt’s medical decisions, and was able to expand that to cover the financial decisions, apparently without the knowledge of the aunt’s children, who lived out of state.

When her charities fell on hard times over a Medicaid dispute — the government ordered her to repay almost $200,000 because it wasn’t accredited — she allegedly claimed the aunt let her use the money to prop them up, prosecutors said.

“Defendant often committed her crime under the further false pretense that the funds were being expended for the benefit of ‘Healing Harvest Ministries, Inc.’ d/b/a ‘Special Needs Services’ a/k/a ‘Perspectives Behavioral Health’ and/or were a ‘loan’ that the victim had made to defendant for that purpose. In truth, defendant was using the monies for personal expenses, including a family vacation to California and Nevada, furniture, hair and spa expenses, and other personal items,” prosecutors said in sentencing documents.

When it became clear that criminal charges were in the offing, Henny allegedly entered into a “sham divorce” to hide her assets, prosecutors allege. In the divorce, Henny received $90,000 from the husband’s retirement account, which she moved to her other accounts and a prepaid debit card, records state.

She also allegedly misled federal probation officials in preparing a financial statement, claiming she didn’t have any income. But the government discovered she received thousands of dollars in unemployment benefits through December 2020 because of the COVID-19 pandemic.

Iowa Workforce Development had questioned her ability to receive unemployment because she hadn’t reported any income in her 2018 and 2019 tax returns, court records state.

Henny also is awaiting the outcome of state charges related to the incident, and any time from that offense will run concurrent with her federal sentence, according to court records.