A former Winnipeg hospital employee has been sentenced to three years in prison for stealing $1.2 million over a 10-year period to fuel a gambling addiction.

Michelle Cadger, 47, pleaded guilty last year to fraud over $5,000. She returned to court Wednesday to learn her fate.

The case came to light in 2010 when internal concerns prompted the Misericordia Health Centre to hire an external auditing firm that confirmed a massive amount of money was missing from a hospital bank machine. Cadger has since been fired from the job she had held since 1980.

The provincial government has filed documents in Court of Queen's Bench in an attempt to have Cadger's assets and bank accounts frozen while the case remains before the courts. They also want $25,000 cash she has paid to a local law firm put in trust, alleging the money is the proceeds of crime. The government has also filed a civil lawsuit seeking unspecified financial damages.

According to affidavits, Cadger spent nearly $400,000 of stolen money on slot machines since 2008. She also used funds to take nine friends on a trip to Hawaii and purchase a new car, which has now been impounded.

Cadger worked as an accounts receivable clerk in the hospital's finance department and had access to large amounts of money used to fill the ATM. She used her position to repeatedly remove money from the cash float used to fill the bank machine, the court documents state.

A new finance director at the hospital noticed irregularities, triggering the internal review and subsequent investigation.  Misericordia operated the ATM until the fraud was discovered, at which time the hospital transferred operation to an outside company.

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