BENTONVILLE -- A former Sulphur Springs city employee and her husband Monday each pleaded not guilty to a felony charge in connection with stealing money from the city.
Codi Bates, 32, is charged with theft of property. Her husband, Tyler Bates, is charged with forgery. She faces from five to 20 years in prison if convicted of the charge. Tyler Bates, 37, faces from three to 10 years in prison.
Matthew Cline, a detective with the Benton County Sheriff's Office, began investigating in March after state auditors and Mayor Shane Weber found inconsistencies in the city accounts, according to a probable cause affidavit.
Auditors revealed undocumented disbursements, payroll discrepancies and receipts not deposited totaling nearly $185,000 in the three-year period from July 1, 2017 to March 31, 2019, according to a Arkansas Legislative Audit report.
The report found $144,464 was misappropriated from Sulphur Springs' water department and $40,470 was misappropriated from the town's general fund during this period, Melsine Carter, an associate auditor at the agency, said at a legislative hearing Friday.
Cline found checks were handwritten to Codi Bates and deposited in her personal bank account, according to the court affidavit. Cline checked the city's system and found the checks were listed as though they were written to legitimate entities, according to the affidavit. For example, one check shows in the records it was written to the Internal Revenue Service for $2,279, but was handwritten to Bates and deposited in her account, the affidavit says.
Codi Bates worked as the office manager and was responsible for the city's finances and the only person who handled the accounts, according to the affidavit. She was hired in July 2017 and fired in April.
Bates issued 15 city checks to herself in 2017 for $10,644 and deposited them into the couple's joint account, according to the affidavit. She also issued five checks to her husband totaling $4,422.
Bates is accused of writing multiple checks in 2018 and receiving $56,463 and issuing four checks to her husband totaling $3,973, according to the affidavit.
The affidavit says $75,000 of the stolen money was Federal Emergency Management Agency grant money.
The investigation also found Bates changed her pay to give herself multiple raises. She overpaid herself $83 in 2017; $2,240 in 2018 and $838 in 2019, according to the affidavit.
Tyler Bates was never an employee for Sulphur Springs and was authorized a one-time payment for work as a contractor, according to the affidavit.
The couple will each have an omnibus hearing on Feb. 10.
Sulphur Springs' population is about 530.
NW News on 10/15/2019