BENTONVILLE -- Benton County officials said Tuesday more than $1.1 million was taken from a county travel fund over a 10-year period.
The county's 2015 audit report, conducted by the state Legislative Audit, reported $1,106,569 in disbursements from the county's travel fund that were "undocumented and/or posted to the general ledger but not the travel log during the period from Jan. 1, 2007, through Sept. 7, 2016." County officials received the report by mail this week.
The report says that Connie Guild, the county's senior accounting specialist, was the custodian of the travel fund. Guild was fired on Sept. 7, 2016, according to the audit report. She started to work for the county in 2000. The report also indicated that Guild "appears to have charged $30,037 in credit card purchases without an apparent business purpose during the period Oct. 7, 2015, through Sept. 5, 2016."
The matter is under investigation by the Internal Revenue Service and the FBI. Those agencies have said their policies bar them from confirming or denying any investigation. Prosecuting Attorney Nathan Smith said Tuesday the federal agencies conducted the investigation and will handle any prosecution, and he sees no need to file state charges.
"We're bitter, we're hurt," Brenda Guenther, comptroller, said of the thefts. "There's going to be a black eye for the county, we all know it."
County Judge Barry Moehring said the county already had started to make changes to accounting processes after Guenther was hired in October 2014, which reduced the amount of the travel fund. That change may have led to the improper use of the county's credit cards, which was found to have happened in 2014 and 2015, Guenther said.
Other changes have been made since the county was contacted by federal agencies about the problem in September, and more will be made, Moehring said. The travel cash fund has been eliminated, and policies have been reviewed and updated to require greater segregation of duties and to improve oversight and review, he said. The county also will hire a firm to do a risk assessment that Moehring said could recommend more changes.
Moehring said the county also plans to do an inventory of all county assets valued at $5,000 or more, and to change the use of purchase cards by assigning them to specific individuals and ending the use of "generic" credit cards, Moehring said.
"Not only are we doing everything internally that we know to do, we're getting external help," Moehring said. "We're taking a number of recourses across the board to increase the level of professionalism and accountability in Benton County. There will still be dishonest people. There are people in any organization who will try to do dishonest things. We're going to make that as difficult as possible for that to occur again."
A total of $1,136,606 in questionable and inadequately documented disbursements resulted from internal control deficiencies, according to the report.
Guild would post "additional undocumented disbursement" to legitimate travel claims, according to the report. Most of the undocumented disbursements were coded to fuel costs, the report said, "and resulted in the County Treasurer issuing a check to the travel fund for significantly more than the legitimate, documented travel expenses." The check issued to the travel fund was cashed, and Guild would replenish the travel fund for the legitimate, documented travel expenses "leaving the undocumented cash balance unaccounted for."
The audit report said "a lack of management oversight permitted these disbursements to be processed."
Several justices of the peace said Tuesday that they were "appalled," "shocked" and "disappointed" at the extent of the problems.
"I think there's going to have to be a lot of hard questions asked," Justice of the Peace Joel Jones said.
The county's elected officials and department heads will have to make changes and more closely supervise their employees, said Jones, who added that the Quorum Court itself can't really do much.
"From the Quorum Court's perspective, that would be difficult," Jones said. "We don't look at every individual expense and reimbursement. That's the problems with the view from 30,000 feet level. We can't see it, just like nobody saw it while it was happening."
Tom Allen, justice of the peace and chairman of the Finance Committee, said he supports Moehring's proposal to have an outside firm look at the county's policies and procedures.
"I think everybody in the county is disappointed and astonished by what took place," Allen said. "I think we're going to be asking for help from Legislative Audit and possibly an outside auditor. To me, it's still a developing story. Legislative Audit tells you what's wrong, but they don't tell you what to do about it. That's why we need to hire someone."
Justice of the Peace Kurt Moore said the county has to work to prevent anything similar from happening.
"Moving forward, all we can really do is be supportive of the judge in his efforts to improve the policies and procedures," Moore said. "An outside auditing firm isn't going to be cheap, but the money has to be spent. I don't know if you can ever make it impossible, but you can make it more difficult and increase the chances of someone being caught."
Metro on 02/16/2017