Employee may have stolen over $450 thousand from City of McCleary

Washington State Auditor Brian Sonntag says that a McCleary city employee may have stolen over $450 thousand in city funds between 2005 and 2010. During an audit, the office found misappropriation of $53 thousand and almost $404 thousand in questionable adjustments within the city funds.

In April of 2010, the auditor’s office was notified about a possible loss of funds. While reviewing past due utility accounts, the former Utility Account Manager and the Deputy Clerk were found to have unpaid balances on their accounts.

City policy does not allow employees to have past-due accounts. The City placed both employees on paid administrative leave during the investigation. Following, the City allowed the Clerk to return to her position, but fired the Account Manager.

The City’s investigation found that the former Utility Account Manager did not follow procedures. They found the employee had adjusted the utility records by adding negative balances and depositing payments to her personal account as “City of McCleary”.

Auditors found questionable adjustments to utility accounts and City of McCleary checks written to the city between January 2005 and April 2010, although they could not determine if a misappropriation occurred due to lack of adequate City records.

The former Account Manager told auditors that she did not alter active accounts. She says that she only took refunds that belonged to deceased customers or refunds on inactive accounts. She estimated an average amount to be approximately $390.

The city in a statement thanked the Auditor’s office, but also said “we would be remiss not to note that the loss of funds took place over a possible 12-to 14-year span, including periods previously audited by the State Auditor’s Office.”

They added that “The auditor did the investigation at the same time they were working on the yearly audit. There were no items of fraud found in the audit. The City is disappointed that this audit of potential fraud failed to discover the loss of funds.”

Mayor Gary Dent said that the City is hoping to recover the misappropriated funds.
The City has filed a report with Grays Harbor’s Sheriff’s Office to ensure the case was handled by an agency other than the City’s Police Department.



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