Investigation of larceny is ongoing
PROSPECT — Weeks after the theft of more than $100,000 from a town payroll account was made public, questions remain as to how access was gained to the account and how the thefts went unnoticed for more than a year.
“I can’t emphasize enough that we’re a victim here and it’s still a very active investigation going on by the state police,” said Mayor Robert Chatfield as he and Town Council Chairman Jeffrey Slapikas discussed the matter in the mayor’s office last week.
The theft became public when state police announced Jan. 9 that they charged Tomeckha Gilkes of Waterbury with first-degree larceny in connection with the thefts. Gilkes appeared in Waterbury Superior Court Jan. 10 and was released on a $100,000 bond. She hasn’t entered a plea yet, according to online records, and is scheduled to appear in court again Feb. 19.
State police found that more than 100 unauthorized transactions had been made from the town’s Webster Bank payroll account, including purchases for Nordstrom, payments to a debt collection agency, utilities and credit card accounts, according to an arrest warrant for Gilkes.
State police traced the transactions, finding that Gilkes’ name was listed as an account holder on payments that were made to those companies.
Chatfield said Gilkes never worked for the town or Webster Bank.
The thefts from the account occurred from December 2017 to November 2018, when the town’s in-house financial consultant, Mike Battista, discovered discrepancies in the account.
As of last week, Webster Bank had retrieved $130,806 for the town, Chatfield said. Whether that is the extent of the thefts is still under investigation, he said.
State police said last week the case is ongoing and didn’t provide any further information when asked whether they expect to make additional arrests and if they’ve determined how the payroll account was accessed.
As state police continue the investigation, town officials are moving ahead with a review of the audits and town financial records from the last two fiscal years.
The Town Council voted 8-0 at its Jan. 21 meeting to issue a request for proposals for a firm to conduct the review.
Slapikas said during the meeting that he wants to know why the thefts were missed during audits and a review could provide answers.
The town switched auditors in 2017 and hired Charles Heaven & Company, a Waterbury-based certified public accounting firm. The company’s audit of the town’s 2017-18 budget showed the town ended the fiscal year with a surplus of $1.3 million. According to the report, there were no material weaknesses or discrepancies in the budget, the Citizen’s News previously reported.
“I definitely think we should do it, I think there’s a lot of unanswered questions,” Council member Theresa Cocchiola-Graveline said about the audit review.
Cocchiola-Graveline felt the town should also look at its processes and checks and balances.
Members of the public raised concerns at the meeting about the processes in place in town. The town handles payroll in house, and employees are paid weekly with paper checks.
“If proper controls were in place it should have been discovered immediately,” resident Kathryn Zandri told the council Jan. 21.
Tom Galvin, who was chairman of the council for 10 years until 2017, said the issue shouldn’t come as a shock to officials, adding that deficiencies in reconciling finances were discovered when he was in office.
In 2017 officials looked into seven transactions totaling about $45,000 that were made from the budget for public works employees’ salary to pay five outside vendors and two non-public works employees. At the time, officials determined the cause of the mistakes was “human error.”
“This shouldn’t have been a surprise. This shouldn’t have been a surprise to you Mr. Mayor,” Galvin told the council Jan. 21.
How the thefts went unnoticed is still under investigation, Chatfield said, but he did point to what he described as miscommunications regarding roles and duties when the town switched auditors three years ago.
Battista, who is now a subcontractor for the town, performed the town’s annual audit until the town hired Charles Heaven & Company. Chatfield said Battista had a more hands-on role when he worked as the auditor.
Slapikas said last week that Battista, who the town retained as a financial consultant in the 2017-18 fiscal year, went above and beyond as the town’s auditor.
“No auditor does what Mike does,” he said.
Battista now reconciles the town’s finances monthly, Chatfield said during the council meeting.
Chatfield said he’s looking to make changes in the roles of employees in the mayor’s office and hire a part-time account clerk with a financial background to work in the office.
Only one person, a town employee, had access to the computer used for its payroll transactions, according to Gilkes’ arrest warrant.
Chatfield said the town is also considering switching to a payroll service, instead of doing it in-house.