Thursday, May 24, 2007

City Treasurer? No Background Check Required

Check this out:
Buried under the debt of 10 to 12 maxed-out credit cards and a $35,000 line of credit, the city treasurer of McCausland, Iowa, turned to the city coffers to help her finances, allegedly taking $187,539.85 over eight years.
This first paragraph is what gets my attention. It says all it needs to. The rest of the article is superfluous.

This woman is the city treasurer, yet she is that horribly in debt? How does someone with such piss-poor budgeting skills for her own family get put in charge of an entire city's budget? Don't the city officials look into these things? Isn't there some sort of background check done when they nominate people who are going to be in charge of their money? Gas stations do more thorough credit and background checks for their store clerks because they don't want people to start stealing from them to pay off their debts, and that's a gas station. I've talked to a few people who work at various banks, and one thing that's pretty much unanimous among them is that they can be fired for bouncing one check. And that's just at a bank. If you screw that up, you might mess up the finances for a few, maybe a few tens of people. This woman was in charge of the funds for an entire city. Granted, a small city, but a city nonetheless.

I'm not saying that firing her would have helped her situation any more, but come on. What did you expect would happen, really? I mean, even if she did have the integrity to not steal from the city, she apprently doesn't have the money management skills to not possibly screw up the budget some other way. This is compounded by the pure idiocy of her crime. I mean, did she think no one would eventually notice that she was making out over $150,000 of checks to herself? This is one of the stupidest crimes I've seen in a long time, not just on the part of the criminal, but also the victims for setting themselves up for failure.
A report released Tuesday by the State Auditor’s Office says that from Jan. 1, 1999, to Jan. 31, 2007, Jeri Moore wrote 134 checks totaling $176,823.69 to herself and her husband. Checks for $154,757.60 were written to the treasurer and $22,066.09 written to her husband without his knowledge. The audit also included undeposited collections handled by Moore and unpaid personal utility bills to the couple’s residence at 206 E. Bennett St. totaling $10,716.16.

The audit report also includes recommendations for tightening up accounting and recordkeeping procedures. McCausland, about 20 miles northeast of Davenport near the Wapsipinicon River, has a 2007 annual budget of $269,965.

Moore, 59, is charged with first-degree theft and is free on her own recognizance, with a court hearing scheduled for June 14 in Scott County District Court. She served as McCausland’s treasurer after being appointed in late 1993, until she was removed effective Jan. 1.

The Scott County Sheriff’s Department was involved in the investigation and also examined Moore’s work as a shop control clerk in the Scott County Secondary Roads Department, from which she resigned Jan. 4. Capt. LeRoy Kunde said no irregularities were found with her work there.

Jeri Moore’s husband, Galen Allen “Al” Moore, hasn’t been charged and isn’t expected to be, Scott County Attorney Bill Davis said. She is the only person implicated in the state auditor’s report.

The signatures on checks written to Galen Moore were compared to the signature on his driver’s license, Davis said, and didn’t match.

“There is no proof he knew what she was doing,” the county attorney said.

Galen Moore was a council member for several years and served as mayor from 2000-2003, according to the audit. He retired in 2003 as deputy director of the Scott County Health Department.

Moore apologized to her husband and explained how she got so deeply in debt in a lengthy letter to him that was included as part of the report.

“We should be entering our golden years with no problems, but I screwed that up,” Jeri Moore wrote in the undated letter. “I’ve ruined us financially. I’ve ruined our credit. I lied to you for years ... probably 15 years.”

In the letter, she says she doesn’t know how much money she has taken from the city, but estimates it at $100,000. She also says she forged her husband’s name on the loan and credit card applications. The couple could not be reached for comment. Their listed phone number has been disconnected and city officials said they have moved to DeWitt, Iowa.

Auditors couldn’t determine if any money was taken prior to Jan. 1, 1999, because bank records were not readily available, according to the report.

A comparison of checks to carbon copies done during the audit showed that 129 of the 134 improper checks identified were made payable to a different payee than reflected on the carbon copy. For the five remaining checks, the actual check and the carbon copy were both payable to the former city treasurer, but the amounts on the checks were bigger than recorded on the carbon copies. All but one of the checks were written for a larger amount than recorded on the carbon copy.

Though the city had a series of safeguards in place to protect from fraud, including signing and counter-signing checks by the treasurer and city clerk, they failed, State Auditor David Vaudt said.

“She circumvented the controls that were in place,” Vaudt said. “The key is trust, but verify.”

Moore was writing checks in her name and her husband’s name after having the city clerk, Paula McIntosh, sign blank checks as they prepared for the monthly city council meeting. The signed checks often included several extra in case of mistakes at the meeting, according to the audit report.

The city had carbon copies of the checks and didn’t request that cancelled checks or their images be provided in monthly bank statements, Vaudt said. The audit report noted several other areas that showed a lack of oversight by the city council.

The main recommendation made in the auditor’s report was better segregation of duties in depositing and disbursing city funds. Mayor Mike Ernst said the city’s new computer system will help strengthen accounting procedures, but that other oversight will be done.

“We are going to have to be more by the book,” he said. “Even if it takes more time.”

Other recommendations include reconciling utility billing, collection and delinquencies, keeping the city’s road use tax money separately from the city’s general operating fund, keeping better minutes of council meetings, reviewing its lien policy toward sewer and garbage account balances, implementing time sheet procedure for hourly employees and improving record-keeping, including retaining canceled checks.

Ernst said the city council would also push for more frequent audits or regularly scheduled audits by the State Auditor’s Office.

The city, with a population of 299, has not been audited in the past because of its small size. State code requires audits every four years in cities with 700 to 2,000 residents. Those with fewer than 700 residents may have one done by special request or public petition.

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