A federal grand jury has indicted a former Kauai Police Department lieutenant for allegedly stealing $75,000 from the department’s operational funds.

Karen M. Kapua, 53, appeared before U.S. Magistrate Judge Barry Kurren in Honolulu on Thursday and pleaded not guilty to charges of three counts of embezzlement and one count of money laundering.

The FBI arrested Kapua on Kauai on Thursday and transported her to Honolulu. Kapua was released after she posted $50,000 bail, and returned to Kauai. Her trial is set for March 15 before Chief U.S. District Judge Michael Seabright.

If convicted, she faces up to 10 years in prison on each of the theft and money laundering charges.

According to the indictment, Kapua stole $25,000 on three separate occasions from December 2013 to December 2014, totaling $75,000.

On Dec. 8, 2014, Kapua allegedly laundered the proceeds of one of the theft offenses and initiated a wire transfer of $11,457.98 to pay off her personal debts.

The FBI initiated a investigation on Kapua sometime in August or September. She was terminated from the Police Department on Dec. 6 as a result of an internal investigation, according to FBI spokesman Tom Simon.

“The FBI works closely with the Kauai Police Department. We regard these charges as an anomaly that do not reflect the greater value of the Kauai police,” said Simon.

In an emailed statement, Kauai Police Chief Darryl Perry said, “As with any arrest, all individuals are presumed innocent unless and until proven guilty in a court of law.

“I am hopeful that the public will view this as an isolated incident and not a reflection of the department as a whole.

“I stand by the men and women of the Kauai Police Department and their commitment to excellence.”

A 20-year veteran of the department, Kapua was recognized as the department’s officer of the year in 2010.