MADISON - Four felony counts were reduced for a woman accused of defrauding two foreign exchange students.

Thirty-five-year-old Fayette Klug pleaded no contest to theft by deception (over $1,500), a Class II felony, and unauthorized use of a financial transaction device, a Class I misdemeanor, in Madison County District Court here Monday afternoon. Two other counts were dismissed as part of a plea agreement.

Madison County attorney Mike Long said that Klug was hosting two foreign exchange students - one from Norway and one from China - in her Norfolk home last fall. Long said Klug asked the two girls for money to cover expenses while they were in the U.S. and used their pre-paid credit cards to make unauthorized charges.

The two students didn't understand that Klug was actually being reimbursed by the foreign exchange student placement company and didn't need to pay her themselves.

Training to host foreign exchange students clearly sets out the financial responsibilities of the host family, Long said.

"This type of activity - taking cash and using credit cards of students is clearly prohibited," he said.

The foreign exchange placement company in which Klug worked for - STS Foundation - has been scrutinized for allowing Klug to host foreign exchange students in the first place because of her being a prior convicted felon. She was sentenced in 2006 for a theft by deception charge to 264 days in jail.

In court Monday, Klug did not respond to the factual basis offered by the state.

In giving a no contest plea, Klug was adjudged guilty by Judge Robert Ensz.

As part of the plea agreement, the state also agreed to recommend a total of one to three years at sentencing, to be served concurrent. Even though that will be the recommendation, Ensz told Klug he is not bound to follow that.

No additional charges will be brought against Klug for the two foreign exchange students named in the case.

A pre-sentence update was ordered to be completed by the Norfolk probation office. Sentencing, including a restitution hearing, was set for July 23.

Klug remains out of jail on a personal recognizance bond of $1,000, filed on May 18. As part of her bond, Klug must reside at the Norfolk Rescue Mission, not leave the state or violate any laws.

The bond had been previously set at 10 percent of $40,000.

Madison County Attorney Joe Smith said he agreed to reduce bond in the case because Klug had already spent seven months behind bars.

In other news

Nebraska Gov. Pete Ricketts, in accordance with a proclamation from the White House, announced that all U.S. and Nebraska flags are to be flown at half-staff to honor the victims of the mass shooting that took place in Indianapolis on Thursday.