The treasurer of the Whitpain Township Board of Supervisors has been charged with stealing nearly $1.5 million in his day job as an accountant.

William McKernan III, 43, of Blue Bell allegedly embezzled the money from a client, environmental contractor K.W. Reese Inc., and used it to cover credit card bills and personal expenses, including state and federal taxes he owed.

According to the Montgomery County District Attorney's office:

McKernan had managed the contractor's month-to-month bookkeeping since 2000, under the accounting enterprise that his father, William McKernan Jr., has operated for decades.

In 2004, the younger McKernan allegedly began transferring thousands of dollars from K.W. Reese's bank accounts to pay his Chase credit-card debt, and later did the same to pay his American Express and Bank of America bills.

The unauthorized transfers from 2004 to 2009 added up to $1,497,693.72, prosecutors said, including more than $105,000 to the Internal Revenue Service, the state Department of Revenue, and the U.S. Treasury.

The governmental payments helped cover the taxes owed by other accounting clients of McKernan, raising the possibility of further chicanery, District Attorney Risa Vetri Ferman said.

"This raises a red flag that he may have compromised those clients as well," Ferman wrote in an e-mail today. "We will be exploring that question."

Prosecutors also are investigating McKernan's activity as treasurer of Whitpain Township, where his six-year term as supervisor is expiring.

McKernan did not run for reelection this year, citing personal reasons, Supervisors Chairman Joseph J. Palmer said.

Palmer, who shared the Republican ticket with McKernan in 2003, said he was "absolutely" surprised by the allegations. He said he doubted prosecutors would find suspicious activity within township ledgers, which Palmer said are overseen primarily by staff, not supervisors.

"Bill McKernan is our treasurer, but he doesn't handle any of the funds," Palmer said.

When K.W. Reese officials confronted McKernan over the missing sums in February, he admitted taking $175,000 but said he was willing to repay $800,000 for the loss and damages, prosecutors said.

Later, he allegedly drew up a check from his account for $500,000 to the company and e-mailed its lawyer, saying he would make K.W. Reese the beneficiary of his $1 million life-insurance policy.

"I am at their mercy," McKernan wrote, according to an affidavit from the criminal case.

He did not return a call today.

McKernan was arraigned today on counts including theft, fraud, and dealing in proceeds of unlawful activities. Magisterial District Judge John S. Murray III in Blue Bell set bail at $50,000, and McKernan posted the required 10 percent.

His preliminary hearing is set for Nov. 27.