Former city worker could face arrest for stealing city funds

Published 7:15 am Wednesday, June 15, 2016

According to the Louisiana Legislative Auditor’s office, a former water clerk with the city of Bogalusa may be under arrest soon for having allegedly taken as much as $5,006 in tax and utility payments from the city.

In total, the city is short $5,612, though state auditors couldn’t conclude who may have taken the rest of the money.

The alleged thefts happened between Sept. 16, 2015 and Feb. 12, 2016.

In an executive summary, the auditor’s report says, “Although three city employees were responsible for collecting payments during this period, former water clerk Jodi Herrington was primarily responsible for receiving, recording and processing 89 percent ($5,006) of the missing funds. These records further indicate that Ms. Herrington altered city records to conceal property tax payments collected but not deposited. By failing to deposit all property tax funds collected and by altering city records to conceal property tax amounts not deposited, Ms. Herrington may have violated state law.”

While Herrington no longer works for the city, the Washington Parish Sheriff’s Office confirmed that as of Tuesday afternoon, she had not yet been arrested. That call will come from the attorney general.

According to the state auditor’s report, Herrington would take tax payments from residents, then cancel the payments from the computer system prior to reconciling her drawer for the day. Investigators recovered dozen of receipts for payment that indicate Herrington accepted tax payments that she later cancelled.

Herrington could not be immediately located for comment for this story, but in the audit report, she denies taking the money.

The audit report says, “Ms. Herrington states that she was not certain how payments she collected would have been cancelled in the system and the funds not deposited. She agreed that she had likely collected the cash payments but denied taking any of the missing funds. She stated it was possible that, when she stepped away from her workstation, another city employee could have used her computer and system access to cancel the payments and then remove the cash from her drawer.

“We spoke to all of the other clerks who received payments during the audit period. Each of these clerks stated that they worked from their own drawers and used their own system usernames and passwords. In addition, neither of the two clerks with the workstations near Ms. Herrington’s workstation noted any instances in which another city employee went into Ms. Herrington’s drawer.”

Several people who had made payments that were later cancelled got notices of delinquent taxes.

Besides ad valorem tax payments, Herrington may have taken about $920 in utility payments from mid-December through late January. Another $300 is missing from Dec. 1 and it’s not clear who could have taken that money. In addition, a total of $306 is missing from mid-September from the drawers of three employees, but the audit report says this discrepancy could be due to a computer error.

In fact, the total of $1,526 missing from the utility department could be only a fraction of the missing payments, as these were the only discrepancies reported by city employees.

The audit report indicates that deficiencies in controls over utility payments makes it difficult to say who actually took the payments. Essentially, employees report on themselves whether money is short, so if several employees conspired to defraud the utility department, more money could be missing.

“These deficiencies prevented auditors from determining with any degree of accuracy if all utility payments collected were recorded in the utility system deposited in the city’s bank account,” the report states.

Typically, utility clerks accept payments and later put their day’s payments into sealed money bags. The next day an employee of the city would count the money in the bags and notice discrepancies. That is where the missing $1,526 turned up.

However, the audit report notes that there is no independent verification of funds when they’re initially placed into the money bags, and because the bags move to different locations and are handled by different people several times, “the city could not determine the point at which these funds went missing during the reconciliation process.”

The final three discrepancies, totaling $920, were all payments collected by Herrington. However, the audit report notes that Herrington pointed to the poor controls in place in the utility office and suggested another city employee could have removed cash from the money bag.

But there was one instance when a shortage in Herrington’s bag was immediately noted.

According to the report, on Jan. 26 this year, another employee verified Herrington’s cash count before Herrington left to run an errand and that employee noted a $320 shortfall and verified the cash count.

Both Herrington and the other employee, with the last name of Hines, were placed on administrative leave with pay on Feb. 19. Herrington resigned Feb. 26 and, based on the audit, Hines was asked to return to work.

Mayor Wendy Perrette wrote a letter to the state auditor’s office, and in that letter she wrote she doesn’t believe Hines was at fault or is responsible for any of the missing funds.

In an interview Tuesday, Perrette pointed out that the city called state auditors in February, as soon as the discrepancies were noticed.

“It’s rare that many people call the legislative auditor’s office on themselves,” she said.

But, Perrette said, she would not tolerate theft.

“We’re not going to have any of that,” she said. “We’re going to report this to the proper authorities, because this money belongs to all of us.”