Former City of Bardstown CFO arrested by feds

BARDSTOWN, KY (WAVE) - The former Chief Financial Officer for the City of Bardstown was arrested by federal officers on Tuesday morning, WAVE News Troubleshooters have learned.

Tracy Hudson, 41, is facing a federal wire fraud charge for scheming to defraud the City of Bardstown out of $762,000 dollars according to the US Attorney’s Office.

The attorney’s office stated between 2013 and 2019, Hudson was taking cash from city funds for personal use, paying herself for false reimbursements, using the city’s credit card and diverting unauthorized additional payments into her 401K.

FBI agents found Hudson was committing wire fraud in the process.

Hudson is being detained on a federal hold at the Oldham County Detention Center.

Bardstown Mayor Richard Heaton revealed he suspected Hudson was stealing city money in September 2019.

Hudson was fired in October 2019. The city collected $130,000 back from her through her attorneys. The case was turned over to the Kentucky State Police at the time.

She faces 20 years in prison in addition to having property obtained with the stolen funds seized by the U.S. government.