An independent audit of the town of Oakdale found that a now deceased town clerk transferred nearly $500,000 of municipal funds to her personal bank accounts without authorization over a two-year period.
The Clerk allegedly made transfers estimated at $248,564 and $203,753 for the fiscal years ending June 30, 2020 and 2021, according to the audit by Kolder, Slaven and Company of Oberlin.
Additionally, the city had $236,919 in seized intergovernmental revenue under the U.S. Treasury’s compensation program for assessed payroll taxes, penalties, and interest relating to fiscal year 2016, believed to be the result of fraudulent payroll transactions not allowed.
The audit was released Monday by the office of the state Legislative Auditor.
The independent auditor also reported several other internal control findings, including that the city did not have adequate separation for its accounting processes, did not reconcile any of its bank statements in a timely manner, did not comply with the law on the budget of local authorities and had been in default of payment. file and remit sales taxes collected to the Louisiana Department of Revenue for the 2021 fiscal year.
A separate investigation released earlier this year by the state Legislative Auditor’s Office identified $897,818 in potential misuse of municipal funds between Jan. 1, 2014, and March 17, 2021.
Much of the fraudulent activity was carried out through payroll, with the clerk apportioning expenses across all city expenses.
To date, no restitution has been made, but loyalty bond insurance claims have been filed and the city has been awarded $105,000. The city is also pursuing civil lawsuits against the clerk’s family and his former auditor to recover some of the lost money.
The state began investigating the findings last year after receiving a complaint from the city auditor about improper transfers made to an employee’s personal bank account.
The employee suspected of being responsible for the hijackings died in March 2021 before the completion of the state investigation and follow-up audits. She had been a clerk for 19 years and reportedly had access to two electronic devices that allowed her to complete the transactions.
Ongoing investigations have not indicated that other people were involved in the hijackings.
