The City of Bardstown has been given recommendations on how to handle taxpayer’s cash after an internal audit revealed thousands of dollars were allegedly embezzled by a former chief financial officer.
The report confirms nearly $764,000 in missing cash receipts, undocumented personal expenses and account credits from 2013 to 2019.
It outlines how the CFO was able to conceal the missing money – like taking cash from payments made by customers before a deposit was prepared, buying a $1,449 cell phone on the City’s credit card and getting paid for vacation time before it was accrued.
During an October 13 audit presentation to the Bardstown City Council, Linda Gray, a Louisville-based certified public accountant, outlined some of the money that was taken:
Cash was taken from the payments made by the customers before a deposit was prepared and deposited in the bank.
Expense reimbursements without proper documentation and approval totaling $899 were included on paychecks.
Payments were made by the City on behalf of the former CFO/OTA to the 401K pension plan in excess of the amount withheld from the former CFO/OTA’s wages. The excess payments totaled $700 in the fiscal year ended June 30, 2019 and $100 in July 2019.
An I Phone XS Max was purchased on a City credit card for $1,449 for personal use of the former CFO/OTA.
On several occasions, vacation pay was paid before the vacation days were accrued. No one verified or approved these transactions.
A $1,600 pre-payment credit was recorded on the former CFO/OTA’s cable account that could not be traced to an actual payment.
$134,121 in missing funds have been recovered along with an iPhone. Officials said a credit on the former chief financial officer’s cable account has been reversed.
The former chief financial officer, who has not been named, has not been charged with anything at this time but the findings in the audit have been turned over to Kentucky State Police.
Kentucky State Police did not give a timeline for when the investigation will be complete.