Accused Department of Revenue fraudsters plead not guilty

Lynne Hunsley and Danielle Degenstein appear in Hughes County courtroom Tuesday

(Austin Goss/The Dakota Scout)

PIERRE - Two Pierre women have pleaded not guilty to charges stemming from a fraud investigation involving the South Dakota Department of Revenue.

Both Lynne Hunsley, 64, and Danielle Degenstein, 51, entered their pleas before Sixth Circuit Judge Christina Klinger on Tuesday.

Degenstein faces a single misdemeanor charge of misprision of a felony and is scheduled for a non-evidentiary court appearance on Dec. 30. Facing seven charges, including five felonies, Hunsley requested permission through her attorney, Ellery Grey, to travel to Nebraska to visit family, first reported by Pierre-area radio station KCCR.

Lynne Hunsley

Assistant Attorney General Nolan Welker agreed, on the condition that Hunsley’s travel be limited to South Dakota and Nebraska, and that Grey notify the Attorney General’s office of her out-of-state trips ahead of time.

Hunsley is next scheduled to appear in court in late January.

Both women were accused of fraud by Attorney General Marty Jackley last month after the discovery of a long-running vehicle titling scam involving a former employee in the state revenue office who worked with Degenstein.

During an October press conference in Sioux Falls, Jackley alleged Degenstein was not forthright with investigators when questioned regarding a vehicle titling scheme that she is accused of having knowledge of. That titling incident is separate from the one Hunsley is accused of having engaged in.

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Hunsley’s charges stem from allegedly using her state employment to falsify tax documents in order to pay less taxes on a personal vehicle purchase.

Another former state employee accused of bilking taxpayers, Lonna Carroll, is expected to be in court in the coming weeks, though a previously scheduled trial has been delayed.

Initially scheduled for Dec. 4, a spokesman for the Attorney General’s Office told The Dakota Scout Tuesday that a new date is being determined. He did not disclose the reason for the delay.

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