The clerk in the Town of Grieg used funds intended for an environmental improvement project to conceal a shortage in a tax collection bank account, according to an audit released today by State Comptroller Thomas P. DiNapoli. The case has been referred to State Police officials for investigation.
Auditors found that the clerk diverted a $17,365 state grant check for the Black River Watershed into a Town of Grieg tax collection account to cover a $16,000 shortage. When questioned about the discrepancy by auditors, the town clerk acknowledged the shortage and later reimbursed the town from her personal account for the full amount.
“The lack of basic board oversight and poor recordkeeping allowed this individual to cover up that thousands of dollars were missing,” said DiNapoli. “Town residents shouldn’t have to question if their tax dollars are being used properly. Working with our law enforcement partners, we will determine if further action is warranted.”
The clerk offered various possible explanations to auditors for the shortage and said she believed it was probably due to a combination of issues – cash errors, incorrect change, misplaced money and payments posted in the computer system without being paid.
The audit, which covered 2008 through 2011, also found:
· The clerk inappropriately allowed her granddaughter to help collect taxes in 2011;
· The clerk did not maintain a cash receipts journal to record the moneys collected for licenses and fees;
· The clerk did not provide financial reports to the board to enable monitoring activity in the Black River Watershed account;
· The town board did not audit or contract with an independent auditor to examine the records maintained by the town clerk.
DiNapoli said the town board should perform an annual audit of the clerk’s records and consider more frequent monitoring of the clerk’s financial activities to help ensure that records and reports are adequate and accurate.
Additionally, the audit recommends:
· The town should ensure that all receipts are properly recorded and deposited in an accurate and timely manner.
· The clerk should maintain a cash receipts journal to account for fees collected.
· The board should ensure that the town supervisor maintains custody and accounts for town funds and does not inappropriately delegate this responsibility to other officers.
The town, located in Lewis County, has begun to implement many of the Comptroller’s recommendations.
For a copy of the report visit: http://www.osc.state.ny.us/localgov/audits/towns/2012/greig.pdf