Source: Sherman Publications

Village’s missing $20K sparks calls for investigation, criticism of oversight

by CJ Carnacchio

May 16, 2012

It wasn’t a topic scheduled for discussion at the May 8 Oxford Village Council meeting, but the public, along with some officials, decided to make it a lengthy one.

Folks want to know what the village is doing about the $20,000 in 2010 property tax money that was discovered missing last year.

Oxford Township Supervisor Bill Dunn, who lives in the village and attended the meeting as a concerned resident, indicated he’s had concerned citizens approach him because they feel like nothing’s being done.

“These people feel there’s no sense of urgency on (the part) of the village council,” he said. “Is anyone on this council going to ask for an investigation?”

Village Manager Joe Young indicated the matter of the missing $20,000 was turned over to the Michigan State Police last year when that agency was investigating former Deputy Clerk Marion Patricia Paad for the alleged embezzlement of more than $3,300 in village tax money in 2006-07 and nearly $600 in police funds in 2010.

“This matter has been under and is still under state police investigation,” said Young, who noted he called the state police, but indicated he has not been advised of the investigation’s status because they were waiting on the outcome of the trial.

This reporter left a message for State Police Det. Sgt. Joseph White, who conducted the Paad investigation, but he did not return the call.

An Oakland County Circuit Court jury recently acquitted Paad of all five embezzlement charges against her. Neither Paad nor anyone else has been charged with any crimes related to the missing $20,000.

“That lady (Paad) was deemed innocent and I have to go along with the jury, but somebody’s got to have this money,” Dunn said. “It is somewhere and it’s up to you guys to show some sense of urgency and try to get to the bottom of it.”

Councilman Tony Albensi agreed.

“I want to know and I would like to demand that we as a council . . . have a meeting with (the Michigan State Police investigator) and find out specifically what’s going on,” he said.

On May 15, Young told this reporter White contacted him and indicated his willingness to meet with council. A time and date will be set.

Albensi indicated there needs to be a dialogue, so the village council can “determine exactly what is being investigated” and “what is not being investigated.”

“There were some very disturbing facts that came out of that (Paad) trial and I am not comfortable with a lot of those issues,” he said.

The councilman believes there needs to be better communication.

“I think you as a village manager need to be more diligent in managing the village . . . informing council of exactly what’s going on,” Albensi said. “I’m not really saying that you’re not . . . (but) we haven’t been really kept abreast of what is going on with that (missing $20,000) and shame on me for not asking in the past. I will continue to ask about that . . . It makes us look very incompetent and . . . I’m ashamed of that.”

Young noted he did refer the matter of the missing $20,000 to the village’s insurance provider because it falls under the category of “employee fidelity.”

“We do have insurance coverage regarding this matter,” he said.

Councilman Dave Bailey announced he had launched his own investigation, as a concerned citizen, into the “whole thing,” meaning the missing $20,000, plus the tax and police funds Paad was originally accused of stealing.

“Okay, she was found not guilty,” Bailey explained. “I support the jury system. If the jury says she’s not guilty, then Dave Bailey says she’s not guilty, also.

“However, that jury verdict does not bring the money back. It’s still gone. And that jury verdict does not make the evidence go away. There’s still various documents that still exist.”

Bailey noted he’s particularly intrigued by the handwriting on some of the documents he’s seen.

“I’d like to know what a handwriting expert would say about whose handwriting is on those various documents,” he said. “I’m thinking I might decide that it looks like maybe some of those documents were forged. And if they’re forged, I’d like to know whose handwriting is on them and when were they forged and what was the motivation for forging them.

“I’ve gone into paranoid mode here,” Bailey continued. “I’m suspicious of everybody and I don’t like it. I’m not comfortable in that mode. I trust everybody normally. Now, I don’t trust anybody. I don’t expect anything to come of my investigation, but I sort of hope that something will come out of it. But I’m not a detective, so what can I say.”

Councilman Elgin Nichols, who was appointed and sworn in just prior to this discussion, gave his assessment of the situation.

“I think at the very minimum we’re looking at some pretty sloppy accounting,” he said. “If there are no tools in place to keep these things from happening in the future, there sure as heck ought to be.

“We do need to have an audit. We do need to find out where the problems in your accounting methods are.”

Young noted the village made two “major” changes to the way it handles money it receives from the public.

The first is a requirement that whenever a payment is made at the village office, it must be run through the cash register at the time it’s accepted and a receipt is generated.

The second involves the township reconciling and posting village residents’ property tax payments on a daily basis, according to Young.

A few folks suggested the village hire an independent firm to come in and conduct a forensic audit to find out where the missing money went.

“We definitely need some outside source to look at this,” Nichols said.

Young noted he could approach White about the possibility of conducting a forensic audit, but it would be “his call to make.”

Albensi disagreed. He said the village could do it separately from a state police investigation.

“It’s great that everybody has confidence that the state police are on the case,” noted Mark Young, who owns a downtown jewelry store and previously served on the Downtown Development Authority (DDA) board for several years.

However, Mark Young noted that during the Paad trial, it was indicated the state police “felt that it was a low priority case.”

The jeweler encouraged the village to have a forensic audit conducted, which he estimated could cost at least $30,000.

He also encouraged them to take action when the results are known, something the village didn’t do when the DDA had a forensic audit conducted in 2008 and it was discovered there was almost $12,000 missing from its 2005-06 fiscal year. There’s “still no explanation” for that, Young said.

“Are we going to wait another six years to find out what happened to the $20,000-plus?”

Mark Young placed the blame for this missing money at the feet of the village manager.

“I’m suggesting that you make fundamental, structural changes to your administration, specifically to the finance director/village manager,” he told council. “I think this is where (it) all stems from. There’s too much chaos and confusion in that (village) office.”

Village President Tom Benner suggested the problem with the municipality’s accounting and finances stems from the fact that due to budget cuts, the office is short-staffed resulting in a lack of “checks and balances.”

“It’s very, very difficult to keep track of our money,” he said. “We desperately need someone in the office that can help with these checks and balances (concerning) the monies that are coming and going. Without that, I think we’re just on a sinking ship.”

Village resident Marlene Taube disagreed with the idea that a staffing shortage is the problem.

“I don’t believe adding staff is going to find a crook,” she said. “I don’t care how many people you have on staff, if you don’t find the culprit, you won’t solve the problem.”

“We are assuming that we found the right culprit, even though she was found not guilty by a (jury) of her peers,” said Benner, referring to Paad.

Resident Sue Bossardet, who’s a former village president and council member, and Mark Young also didn’t agree that staffing is the issue.

Bossardet noted that when her property tax payment was allegedly stolen in 2006, there was a “full complement” of employees working in the village office at the time.

“That obviously didn’t help,” she said.

“I don’t care how many people you hire, you’re not going to find out what’s happening as long as you have this (chaos and confusion) occurring in your office,” said Mark Young. “It doesn’t take 10 people to figure out (the) daily business activity. It takes one or two really sharp people to manage it.”

Finances aside, Bossardet indicated that overall, what the village truly needs is something money can’t buy.

“I was raised to believe and expect that our public officials would be honest, have personal integrity and accountability,” she said. “I know that’s in short supply sometimes nowadays. I want people in office and working for the village who possess those qualities and if we can’t have that, then they need to go.”