Probe uncovers finance problems in Meigs County

Arkansas-LSU Live Blog

A Tennessee Comptroller's Office investigation report uncovered problems in Meigs County's finance and school departments.

The investigation involved selected records spanning July 1, 2008, through Nov. 30, 2013, at the finance department and from July 1, 2013, through May 28, 2014, in the school department, according to the report.

Investigators found that finance department employees were paid $26,604.17 in unauthorized compensation. The former interim finance director received $24,550 that was in addition to her regular salary. Another former finance director received additional compensation of $1,012.50, and the current finance director received additional compensation of $1,041.67, according to the report.

There was no documentation or authorization on file to support any of the additional payments, the report states. Detailed time records were not on file to support the payment of $1,201.50 for compensatory leave of the former interim finance director. Leave should not be approved unless it can be supported with adequate time records, comptroller's office officials state.

Meigs County Mayor Bill James, who has been on the job less than 10 weeks, said officials "are making sure that it doesn't occur again."

"Unfortunately, things like this happen when you give somebody the opportunity to make mistakes they shouldn't make," James said.

Policy changes are in the works to address the findings in the county finance department, he said.

James noted that many of the problems arose while there were leadership shifts in the finance department due to personal and family illnesses.

One of the former finance directors -- the report doesn't name which one -- officially responded in the report.

"When I was appointed interim finance director, the salary for the position was to start at the former finance director's beginning salary," part of the interim finance director's response states. "An informal decision was made by the finance committee to include the payments from the health department as part of the salary and to cut the beginning salary in the finance director's budget by $3,000 per year until those funds were exhausted."

A response from the former county mayor, Garland Lankford, states that he was unaware of health department funds "being diverted to the former interim finance director for her own benefit."

Investigators also found the school department violated its conflict of interest policy by making purchases from a business owned by a school employee. Between Oct. 1, 2010, through May 28, 2014, the department spent $96,564.44 for supplies from Decatur Plumbing and Electrical Supply, a business owned by a school maintenance employee. Management had reason to suspect a possible conflict of interest existed, according to comptroller's office officials.

Director of Schools Don Roberts said Thursday that the conflict was a violation of school system policy, but there was nothing "illegal" about the business relationship.

The school system had done business with the plumbing company since 2001, but unbeknownst to school officials, ownership of the family owned business was transferred to the school employee in 2010.

To remedy the issue, Roberts said all 265 school system employees will now have to sign a disclosure form regarding potential conflicts of interest as part of their annual contracts.

The findings have been reviewed with the Ninth Judicial District attorney general, the report states.

Contact staff writer Ben Benton at bbenton@timesfreepress.com or twitter.com/BenBenton or www.facebook.com/ben.benton1 or 423-757-6569.

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