An Office of the State Comptroller audit released Thursday provides new insight into how almost $378,000 went missing from the town of Fairfield, and the findings may impact an ongoing investigation being conducted by area law enforcement officials.
The audit found 347 checks written to either Francis Matthews, former town supervisor, or his wife, Randi Matthews, had not been authorized by the town board.
The checks, from 2006 to 2009, account for $377,976.
Randi Matthews has been charged with felony grand larceny, forgery and tampering with public records in connection with the missing funds. She pleaded not guilty and is in county jail while she awaits a trial date.
But the state police and Assistant District Attorney Jeffrey Carpenter are still investigating the alleged theft.
“There is still an open investigation,” said Carpenter, who declined to say if the audit could lead to further charges or arrests. Carpenter said he plans to go over the audit with state police Investigator Ben Scalise who is handling the investigation.
The town board allowed the supervisor to have total control of financial transactions, according to the audit, and little oversight contributed to the misappropriation of funds.
The approval of a signature stamp for the supervisor in March of 2007 even increased the risk, the audit states, and if the town board reviewed bank reconciliation’s or monthly cash balances, the unauthorized checks would have been identified when they first occurred in 2006.
A total of 22 unauthorized checks were cashed in 2006 for a total of $20,151, the audit found. The remaining over $350,000 was spent in the following three years.
The audit also found that 316 of the unauthorized checks, or 91 percent, totaling $349,331 were signed by the signature stamp. And all of the unauthorized checks that were made payable to Randi Matthews, as opposed to her husband, came after the signature stamp was issued.
Randi Matthews, 42, has stated to police that she falsified reports to the town board and hid the missing money from her husband, however.
But while Randi Matthews stated she performed her husband’s financial duties, the former supervisor was ultimately responsible for the work, the audit states.
Placing all of the financial duties under the supervisor’s responsibility contributed to the problem. The action did not separate the financial powers and contributed to the misappropriations, the audit argues.
Randi Matthews’ attorney, George Aney, said he has consulted with her husband related to the case. But Francis Matthews has not been charged and needs no legal representation, Aney said.
Aney has also made comments in the past that Randi Matthews held no official position in town government and took no “oath of office.” The statement to police also contends that she held no position in the town.
The OSC audit states that Randi Matthews did serve in various positions from 2008 and 2009.
The town board approved the supervisor’s appointment of his wife to an accounting officer/secretary to supervisor, with a salary of $1,800, the audit states. In 2009, the supervisor’s wife was appointed as deputy supervisor, with no compensation approved by the town board, the audit continues, and the couple resigned from their positions on Dec. 14.
New town Supervisor Richard Souza responded to the audit requests for changes in town practices.
Souza said since taking office he has implemented many changes to avoid a repeat of the misappropriations.
A few of the changes include:
n All bank statements are made available to the board each month
n Each board member receives a package each month that includes bank statements and copies of written checks.
n Any check that has been voided is marked and placed with the original bank statement.
n The town clerk is the second signature for checks/along with being listed as a contact person for all town matters.
Three of the four town board members, Dennis Maxwell, Richard Hilts Sr. and Ed Blake, that served during the audit period remain in their seats. Russell Zelman resigned earlier this year citing health reasons.
Souza said in a phone interview that all of the town board members have been made aware of and approved the changes.
But Souza also informed the auditors that the impact of the mismanagement and misappropriation of funds goes beyond the close to $380,000.
During the former supervisor’s time in office, over $632,000 was borrowed for various equipment purchases, Souza said.
All of the equipment purchases required the town to borrow the full amount, which added $45,825 in interest payments to the town budget, according to Souza.
Fees, fines and penalties for unreported IRS and state Department of Labor reports also cost the town $10,000, Souza stated.
A loan of $200,000 has also been taken out by the town to pay for bills from 2009.
But the town is still left with close to $600,000 in debt services related to the actions of the former supervisor, be it through misappropriations or unsound borrowing practices, Souza said.
Revenues from a recent windmill project, which helped pay off the loan and cut into the debt service, will likely help the town avoid a tax increase, according to Souza.
“Without them we’d be in dire straits,” he said, “the taxes would probably double.”
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An Office of the State Comptroller audit released Thursday provides new insight into how almost $378,000 went missing from the town of Fairfield, and the findings may impact an ongoing investigation being conducted by area law enforcement officials.
The audit found 347 checks written to either Francis Matthews, former town supervisor, or his wife, Randi Matthews, had not been authorized by the town board.
The checks, from 2006 to 2009, account for $377,976.
Randi Matthews has been charged with felony grand larceny, forgery and tampering with public records in connection with the missing funds. She pleaded not guilty and is in county jail while she awaits a trial date.
But the state police and Assistant District Attorney Jeffrey Carpenter are still investigating the alleged theft.
“There is still an open investigation,” said Carpenter, who declined to say if the audit could lead to further charges or arrests. Carpenter said he plans to go over the audit with state police Investigator Ben Scalise who is handling the investigation.
The town board allowed the supervisor to have total control of financial transactions, according to the audit, and little oversight contributed to the misappropriation of funds.
The approval of a signature stamp for the supervisor in March of 2007 even increased the risk, the audit states, and if the town board reviewed bank reconciliation’s or monthly cash balances, the unauthorized checks would have been identified when they first occurred in 2006.
A total of 22 unauthorized checks were cashed in 2006 for a total of $20,151, the audit found. The remaining over $350,000 was spent in the following three years.
The audit also found that 316 of the unauthorized checks, or 91 percent, totaling $349,331 were signed by the signature stamp. And all of the unauthorized checks that were made payable to Randi Matthews, as opposed to her husband, came after the signature stamp was issued.
Randi Matthews, 42, has stated to police that she falsified reports to the town board and hid the missing money from her husband, however.
But while Randi Matthews stated she performed her husband’s financial duties, the former supervisor was ultimately responsible for the work, the audit states.
Placing all of the financial duties under the supervisor’s responsibility contributed to the problem. The action did not separate the financial powers and contributed to the misappropriations, the audit argues.
Randi Matthews’ attorney, George Aney, said he has consulted with her husband related to the case. But Francis Matthews has not been charged and needs no legal representation, Aney said.
Aney has also made comments in the past that Randi Matthews held no official position in town government and took no “oath of office.” The statement to police also contends that she held no position in the town.
The OSC audit states that Randi Matthews did serve in various positions from 2008 and 2009.
The town board approved the supervisor’s appointment of his wife to an accounting officer/secretary to supervisor, with a salary of $1,800, the audit states. In 2009, the supervisor’s wife was appointed as deputy supervisor, with no compensation approved by the town board, the audit continues, and the couple resigned from their positions on Dec. 14.
New town Supervisor Richard Souza responded to the audit requests for changes in town practices.
Souza said since taking office he has implemented many changes to avoid a repeat of the misappropriations.
A few of the changes include:
n All bank statements are made available to the board each month
n Each board member receives a package each month that includes bank statements and copies of written checks.
n Any check that has been voided is marked and placed with the original bank statement.
n The town clerk is the second signature for checks/along with being listed as a contact person for all town matters.
Three of the four town board members, Dennis Maxwell, Richard Hilts Sr. and Ed Blake, that served during the audit period remain in their seats. Russell Zelman resigned earlier this year citing health reasons.
Souza said in a phone interview that all of the town board members have been made aware of and approved the changes.
But Souza also informed the auditors that the impact of the mismanagement and misappropriation of funds goes beyond the close to $380,000.
During the former supervisor’s time in office, over $632,000 was borrowed for various equipment purchases, Souza said.
All of the equipment purchases required the town to borrow the full amount, which added $45,825 in interest payments to the town budget, according to Souza.
Fees, fines and penalties for unreported IRS and state Department of Labor reports also cost the town $10,000, Souza stated.
A loan of $200,000 has also been taken out by the town to pay for bills from 2009.
But the town is still left with close to $600,000 in debt services related to the actions of the former supervisor, be it through misappropriations or unsound borrowing practices, Souza said.
Revenues from a recent windmill project, which helped pay off the loan and cut into the debt service, will likely help the town avoid a tax increase, according to Souza.
“Without them we’d be in dire straits,” he said, “the taxes would probably double.”
