Arkansas prosecutors filed charges in only 38 of 262 audit cases in 2017, audit report states

Legislators ask how state can do better

State prosecutors have filed criminal charges in only 38 of the 262 cases referred to them by Arkansas Legislative Audit in 2017, according to an audit report released Friday.

Some lawmakers questioned what Legislative Audit could do better. Often, prosecutors don't feel like they can prove criminal intent, said Bob McMahan, the state's prosecutor coordinator.

"If the case is not a good case, they're not going to go forward," McMahan said.

Legislative Audit reports examine the financial well-being and well-meaning of taxpayer-funded agencies throughout the state. They often find troubling expenditures or bookkeeping practices. A Legislative Audit report earlier this year on the Earle School District was followed soon by a state takeover of the district.

Friday's report suggests that punishment for criminal behavior is relatively rare after audits, occurring less than 9 percent of the time in 2017.

Prosecutors cited insufficient evidence as reasons for not prosecuting in 100 of the cases referred.

Courts reached a guilty verdict in only one of the 38 criminal cases. Defendants pleaded guilty or no contest in 22 cases. Two defendants were acquitted. The other 13 cases are pending.

Prosecutors or law enforcement agencies are still reviewing 32 cases.

Rep. Stephen Meeks, R-Greenbrier, asked what Legislative Audit would need to do to make cases easier to prosecute. He referred to auditors' findings of $9,273 in inadequately documented credit card purchases by former Damascus Police Chief Rick Perry and Perry's sale of his body armor and a ballistic vest to two former police officers without authorization.

Prosecutors can't always prove criminal intent, McMahan said.

According to Friday's audit report, 20th Judicial Circuit Prosecuting Attorney Luke Ferguson declined to prosecute in that case after an additional Arkansas State Police investigation because of a lack of evidence.

Reached by phone Friday, 6th Judicial Circuit Prosecuting Attorney Larry Jegley said he often doesn't have enough to go on to prosecute. He sometimes refers cases to a local police agency, but frequently doesn't have a narrow enough scope of a case to proceed.

"I've had legislative audits where it could have been one of 40 people who may or may not have been responsible for a shortage or theft," Jegley said.

Jegley said he sent a letter to Legislative Audit urging auditors to more frequently identify which statutes may have been violated, what documentation is available as evidence and who potential witnesses might be.

"It has been my experience that, sometimes, members of the General Assembly are of the mis-impression that any matter so referred should result in criminal charges being filed," Jegley wrote in the letter. "As you know, that is not always the case."

He said Friday that Legislative Audit should adhere to law enforcement standards in their referrals.

"We're talking about the criminal law, heavy machinery and the same standards apply to a legislative audit as apply to an action by a police agency," he said.

A phone message left for Legislative Audit on Friday afternoon was not returned.

Overall, auditors referred financial discrepancies totaling $20.5 million, and convictions have yielded $5.2 million in ordered restitution, although how much of that has been paid is unclear.

Rep. Kim Hammer, R-Benton, said the state should look at how much guilty parties have paid back and how different courts are ensuring such payments occur.

Of the state's 28 judicial circuits, the 15th Judicial Circuit had the highest ratio of prosecutions to matters referred to the prosecutor (3-to-5). All three landed convictions. The 15th Circuit includes Scott, Logan, Yell and Conway counties in western Arkansas.

In Yell County, a court found Erin Gibby, a financial accounting assistant for the Two Rivers School District, guilty of theft by deception, forgery and tampering with a public record in the loss of $8,663 in activity funds not deposited in the district's bank account.

Also in Yell County, Sidney Ward and Donna Ward, husband and wife, pleaded guilty to theft and fraud charges after $680,175 in payments from Yell County Emergency Medical Services was unauthorized or undocumented.

The 2nd Judicial Circuit had the highest number of cases referred at 44. One resulted in a conviction and 20 remain under review.

The 2nd Circuit includes Clay, Greene, Craighead, Poinsett, Crittenden and Mississippi counties in northeast Arkansas.

A Section on 11/03/2018

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