Riverside County deputies arrested Vivian Benn, of Temecula, during a traffic stop on Wednesday.
Benn, who owns the Family Hope Foster Family Agency (FFA), is suspected of stealing hundreds of thousands of dollars of county money.
In May 2009, the Riverside County Auditor-Controller's Office conducted an audit of the Department of Public Social Services, focusing specifically on several foster family group homes and FFAs, including Family Hope. The audit showed that about $1.2 million in payments made to Family Hope by the Department of Public Social Services was unaccounted for.
This discrepancy led to an investigation that started in June 2012 by the Riverside County District Attorney's Office into Family Hope.
The investigation found that Benn embezzled about $400,000 from January 2004 to November 2009. Investigators say Benn used the funds for her personal use. The probe also revealed that Benn embezzled and misappropriated an additional $125,000 from April 2007 to September 2009 by transferring funds into a bank account she created called Brooklyn Financial.
Authorities say Benn used this account as a "shell company" created under her daughter's name to hide money and avoid paying the Internal Revenue Service.
She was charged with six counts of embezzlement by a public officer, and one count each of embezzling property by a public officer and money laundering.
Her arraignment was scheduled in Riverside on Friday.