SANDPOINT — A Sandpoint woman being sued for allegedly embezzling from her former employer is professing her innocence.

Virginia Katherine Petty was charged with grand theft in 2011 for allegedly stealing from GeoData Technologies from 2007 to 2010, but the state abruptly ceased prosecution by contending it was a civil matter rather than a criminal one.

Petty, 57, was responsible for GeoData’s administrative duties, including all bookkeeping for the company, and had once served on its board of directors, according to Idaho Secretary of State records. GeoData provides three-dimensional computer software used in real estate marketing.

Petty was laid off in the spring of 2010 as part of the company’s downsizing initiative, according to the civil suit against her. Following her departure, company officials noticed Petty had made a series of unauthorized draws on company accounts and unauthorized transfers, the suit alleges.

After the alleged thefts were discovered, GeoData made a $17,247 claim on its insurance policy with Hartford Casualty Insurance Co. for “employee dishonesty.”

Petty, the suit said, met with company officials in the summer of 2010 to discuss the thefts and question expenses she was claiming. Petty had no explanation “other than it had been a ‘mistake in judgment,’” the suit alleges.

GeoData officials later discovered that Petty allegedly made a series of transfers to Black Diamond Engineering, a civil engineering company operated by her husband. Some of those transfers and draws were made to cover loan payments for Black Diamond, the suit said.

Black Diamond was incorporated in 2004 and was administratively dissolved in 2011, secretary of state records indicate.

Counsel for Hartford contends that Petty has been unresponsive to inquiries about her handling of GeoData’s finances or demands that she pay for the claim given to GeoData.

April Linscott, a Hayden attorney representing Petty, filed an answer last month to Hartford’s complaint in which Petty denies the allegations against her.