GBI probe of city utilities underway
After more than a year of extensive auditing, a probe into possible theft from within the City of Cairo Utilities Department is being conducted by the Georgia Bureau of Investigation.
According to Cairo City Attorney Thomas L. Lehman, GBI Special Agent Bahan Rich is in the process of conducting interviews and probing into the possible misappropriation of funds within the city utilities operation.
“Significant discrepancies have been found between what would have been expected to be received from work orders and what was actually deposited,” Lehman said.
According to city officials, a “significant” amount of money, the total amount of which was not made public, appears missing. The money in question is from deposits paid when work orders were written to establish utility services during 2005 through 2008.
Lehman and City Manager Chris Addleton say the discrepancies were first discovered in August 2008, at which time the city was converting to a new financial management and billing software. In September 2008, Tom Carmichael, the city’s auditor, was called in to examine the problem and determine the need for a forensic audit.
City officials requested the forensic audit in September, but elected to follow the guidelines and procedures as outlined by the auditors and allow the legwork for the audit to be done in-house, which took approximately 12 months.
The city’s auditor then took that research and presented city officials with a draft report last September. City officials then instructed the auditor to put the draft into a final report, which City Attorney Lehman transmitted to District Attorney Joe Mulholland late last year.
Mulholland said this week his office had requested that the GBI review the auditor’s finding to determine if an investigation is warranted.
“They have assigned an agent to the case and are in the process of investigating the matter,” Mulholland said Tuesday.
Auditors have told city officials similar cases are difficult to prosecute, and the city attorney says as many as 20 individuals, both current and former employees, at any given time could have “had fingers in the pie.”
The city attorney said that under the best case scenario the GBI could present its findings to the district attorney in time for Mulholland to present the case, if he so chooses, to the Grand Jury in March.
To avoid any future issues regarding escrow deposits, City Manager Addleton says stronger procedures have been put in place at the utility office.
The city manager is also more confident with the new financial management and accounting software now being used by the city.
“Our new system has a very strong audit trail, whereas the old system was weak. If somebody makes a change, we can find it,” Addleton said.