$500K St. Pete embezzlement case: Tampa man sentenced

A Tampa man was sentenced to five years in federal prison after he admitted to embezzling more than $500,000 from a St. Petersburg company, according to court filings.

Zachary Rugen, 34, pleaded guilty to wire fraud and possessing a firearm as a convicted felon. As part of his sentence, he must forfeit more than $440,000, according to a statement from the U.S. Attorney for the Middle District of Florida in Tampa. 

From 2020 to 2022, Rugen was employed as a personnel director for a small company in St. Petersburg, prosecutors say. The company — unnamed in court documents — provided private and corporate security, including both physical and cybersecurity services, according to Rugen’s plea agreement.

One contract assigned to Rugen involved providing physical security at a large facility in France, the plea agreement says. He directed funds intended for vendors and contractors to accounts that he controlled, and he falsified hours worked and payment rates, according to court documents; for example, in 2022, he created an invoice charging the St. Petersburg company more than $98,000 even though the invoice originally submitted by a security contractor was for about $18,000. Instead of paying the security contractor the money it was owed, Rugen admitted to keeping the funds for himself, according to his plea agreement.

“Rugen used the ill-gotten funds to live lavishly, including taking expensive vacations and gambling, and for his personal expenses,” prosecutors say in a statement. “During the sentencing hearing, the victim-company’s chief operating officer testified that the fraud caused substantial financial hardship from which it will take the company at least five years to recover. As a result of the embezzlement, one of the company’s vendors nearly went out of business.”

The FBI interviewed Rugen at his home in Tampa in 2023, where he agreed to be interviewed and admitted to taking more than $400,000 from the St. Petersburg company, according to the plea agreement. During the interview, he told authorities he had a felony conviction and was not allowed to possess firearms. FBI agents found two handguns and multiple rounds of ammunition at his residence, according to the plea agreement.

"Rugen was prohibited from possessing the firearms due to a prior felony conviction involving impersonating a law enforcement officer," prosecutors say.

The FBI and Tampa Police Department investigated the case, which was prosecuted by Assistant U.S. Attorneys Tiffany Fields and Jennifer L. Peresie.

Senior District Judge Virginia Hernandez Covington handed down Rugen’s prison sentence, which will be followed by three years of supervised release, according to court records.