Report, personnel file sheds light on past Aragon cash problems
♦ Dunn discusses mistakes in 2012 letter to City Council, later admits to no wrongdoings in 2017 resignation
A new report from Williamson and Company, the auditors for the City of Aragon, shows there were more checks stashed away and likely never cashed.
Without complete bank records, they however stated in this report provided to the city that they can’t reconcile exactly what happened to the money that at the time was under the control of only one person at the city, former City and later Court Clerk Lori Dunn.
As previously reported, Dunn’s father Mayor Garry Baldwin previously decided to recuse himself in the matter. A document to that effect was part of Dunn’s personnel records, which stated that any administrative or personnel issues pertaining to his daughter were to be referred to then Chief Marc Riley, or to Aragon’s Municipal Court Judge Terry Wheeler.
Wheeler was previously Dunn’s supervisor when she served as the city’s court clerk.
Contents of the report include an outline multiple financial documents from a time period ranging from 2004 to 2016 which were made available to Williamson and Co. for review from the city.
With the report sent onward to the city, it is now up to officials on how they wish to move forward, Christopher Hatch of Williamson and Company stated in the seven page document.
So what’s in the files?
Williamson and Company’s assessment of past financial records, made available to the Standard Journal via an open records request, went over the analysis of the contents of seven files presented to the firm for review.
This was sought in 2017 after numerous checks were found in filing cabinets at the City of Aragon from a time period when Lori Dunn, former city and court clerk, was in charge of the finances.
A request was made and fulfilled to receive copies of these checks and other items that were supplied to Williamson and Company by the Standard Journal, but they are so numerous that additional reporting time will be required before a final tally of the number of checks and how much was left in Aragon’s files over the years.
More or less, the contents of the folders mainly contained records of “cash disbursements paid from the City funds and receipts collected from citizens, customers, insurance carriers and state agencies,” but also contained several internally generated documents including records from Dunn’s personnel files that shed light on what was happening during some of this time. Those were also requested by the Standard Journal under Open Records laws and were turned over.
Overall, Williamson and Company made one thing clear in their examination of the file contents turned over to the city: one person controlling the finances wasn’t a good idea.
“Each file contained numerous transactions that made it evident that there were either no internal controls in place regarding the city’s cash disbursements and receipts, or the controls were either disregarded,” the report stated.
The amount of information is staggering, and to prevent being overwhelmed by it all, below is a brief overview of what Williamson and Company was provided by the city, or at least the portions pertaining to Dunn’s tenure at the City Clerk, and for much of that time period was the only person working on finances.
The information noted includes:
In file 1, officials from the city included communications between Dunn and former Mayor Ken Suffridge about a consistent pattern of negligence displayed by the former City Clerk, who also acted at the time as treasurer. There were two additional documents generated by Dunn herself, the first admitting a number of errors on her part including failure to ensure that software being used to withhold payroll taxes was working.
In file 2, there were 159 checks totaling $16,554.49 that at the time didn’t seem to have been deposited in the bank. The firm also noted two cash advances totaling $4,300 that were made at the time on the city’s credit card, but don’t have matching receipts to provide records of it being used for a approved purpose by city officials.
In file 3, additional copies of checks found were presented, which included duplicates of the checks found in File 2. Also there were some checks within the file that needed further explanation but didn’t have any, including $575.25 signed by Dunn and a council member to herself; one for Municipal Court Judge Terry Wheeler for $438.95 signed by Dunn that he later explained was cashed at the city for payroll at the time, a practice he undertook commonly; and more financial records without any explanation as to why they were collected or disbursed.
In File 4, additional payroll checks were found for Dunn, plus other financial documents including blank check stock and five unsigned checks plus a check reorder form, an email from the Georgia Bureau of Investigation dated May 30, 2017 that didn’t say they weren’t going to look into the matter, but about their lack of interest were not of investigatory value to the GBI. The file also included vendor receipts and more.
File 5, 6 and 7, additional records were provided or left empty, plus two checks from Dunn that bounced for lack of insufficient funds made on Aug. 15, 2014 and Oct. 3, 2014 were included, which totaled $290.
Files also included a stamp of former Mayor Brenda Gazaway’s signature.
Also of note in the records was a copy of a check written by Amy Kelley, wife of State Rep. Trey Kelley who was then new to office, to pay for a speeding ticket in July 2013 written in the amount of $195. The file included a receipt generated two months later in September 2013 for a $95 payment. That check was among those found in filing cabinets at the City of Aragon that was never cashed.
Internal records shine light on finance issues
During Suffridge’s administration, he sent along a number of communications to Dunn that were included in her personnel records.
However the first of those to admit to some responsibility for the mess Aragon was in and continues to try to untangle was in her letter dated May 12, 2018.
Dunn started the letter dated Mat 18, 2018 that “I would NEVER do anything intentional to hurt this city. I was born and raised here. I came back in 1999 because I loved my city and wanted to help it keep going. And I appreciate the confidence that you have placed in me over the last 12 years to be a part of it.”
However, she went on to explain how payroll taxes went for so long without being paid.
“A few years ago I got behind on making withholding tax payments,” the letter read. “After catching up I placed confidence on our financial program to automatically generate reports and automatic payments to withholding. I have just found out that something went wrong and I did not set up the procedure right.”
Those payments according to Dunn’s Dec. 18, 2014 termination of probationary period totaled up to $152,000 to both the state Department of Revenue and the Internal Revenue service.
According to Suffridge’s list of offenses laid out in that 2014 document, the state didn’t receive payroll taxes for employees for four years before the 2012 discovery.
Her May 2012 letter also admitted the following:
“As you know, also a few years ago I made a gigantic mistake that has resulted in a law suit against the city. I failed to post a citation payment and a girls license was suspended. She was incarcerated for the suspended license. I have found out last week that she is (suing) me as an individual also. Anybody who knows me
knows the pain I felt when I was the cause that someone was sent to jail unjustly.”
That letter, generated on May 18, 2012 and also included in her personnel file, did apologize for “these unheard of mistakes.”
“Over the last 12 years the duties that a city clerk must do has doubled,” Dunn’s letter explained. “I have tried my best to adjust to growing changes that this office calls for. Knowing that the city did not have a great amount of money I have tried to do this task by myself up until last year when I finally asked for help.”
Dunn’s letter did cite that the city did provide her with additional support at city hall, and that some of the duties were passed off to a former employee.
“Along with the growing responsibility I have been experiencing slight memory losses,” Dunn wrote. “You can ask me questions and it takes longer than usual for me to reply. I am going to make a list of all monthly reports, payments and due dates for Jennifer (Delgado) to be a part of. I do not know if the stress is causing my problem or physical issues, but I do have a doctor’s appointment on the 30th (of May 2012.)”
Later in October 2012, a letter meant to remain confidential and was included in the record sought to inform the council about an additional mistake, failure to make payments to the Peace Officers Annuity and Benefit (POAB) fund.
Suffridge said in that letter the city knew about the problem only after Judge Wheeler received a Feb. 26, 2012 communication from attorneys representing the POAB fund, and threatening legal action if fees weren’t paid up that totaled $74,000.
“Upon discovery of additional areas of concern I set a meeting for Monday, Oct. 29, 2012 with Judge Wheeler, Jennifer (Delgado), Lori (Dunn) and myself,” Suffridge wrote.
He added the office was closed most of that morning and past lunch, and then went on to explain the financial issues facing the city and added that Dunn had “at least twelve (12) years back and beyond has never had a positive budget. By admission, the City Clerk has been “robbing peter to pay paul” for years following her return as City Clerk in 1999.”
In that letter, Suffridge said he imposed new policies to fix the on-going troubles with the city finances, and all matters were to be produced in a written form that could be approved and implemented through the end of the calendar year.
Questions about the finances didn’t begin to pop up again in documents in her personnel file until 2014, when Suffridge sought additional answers to issues he wanted cleared up.
In a February 2014 letter included in the records request, Suffridge chided Dunn for several concerns he had about the city’s finances at the time including several examples, such as “the amount of money Mike Long owed the city upon his resignation was staggering” and for failing to keep with policies and procedures he put in place more than a year and a half before to prevent continued problems.
“You were doing so good, and felt good about what you were doing,” Suffridge wrote. “I will accept some responsibility for allowing you to “back slide” into some old habits, and not being more forceful, and aggressive in demanding to see everything. You know what needs to be
done, and I don’t want to over supervise, but, it may be necessary.”
He also questioned why checks were being mailed “but not getting to the source.”
“I have questioned the Post Office and have other meeting scheduled with the Post Master,” Suffridge wrote. “This has happened far too many times for it to be believable. I want answers.”
He did add at the end of his correspondence that “The Council is not remotely aware of these issues, and given the makeup of the council I prefer to keep it that way. This is an administrative problem, and I don’t want it to escalate beyond that.”
Dunn’s response included additional explanations as to why she was failing to perform her duties based on Suffridge’s previous communication. In an email dated February 16, 2014, she said that “Reasons for my lack of job performance have already been discussed.”
The e-mail went over specific reasons why a Governor’s Office of Highway Safety grant wasn’t received, about invoices for several vendors and about how she was organizing bills during off-time at home.
“I am taking care of one problem at a time as they come to light,” Dunn wrote.
She also promised to get better about her procedures in that e-mail.
“Your previous email is the butt chewing I had been expecting and welcomed,” Dunn wrote. “Thank you for waiting to a point where I could process and apply what you are telling me.”
About a month later on March 13, Suffridge sought additional information from Dunn about the city’s financial health in a formal reprimand for failing to keep up with accounting procedures he ordered her to put in place in 2012, and that each time he came into the office to undertake his duties as mayor they would review the city’s incoming and outgoing money together.
“Delays and excuses are no longer acceptable,” Suffridge wrote in the March 2014 reprimand. “Doing the job correctly, on a consistent basis is so much easier and a lot more fun, as you discovered. As we near the final quarter of our fiscal year, and begin budget discussions I need to know, financially where we are. Its your job as City Clerk to provide me with all the tools necessary for that process ASAP.”
Dunn signed the reprimand on March 17, 2014.
Based on the records, her performance deteriorated to the point where on April 1, Suffridge wrote in a notice of probation that her performance over the previous 26 months he was mayor the practices she undertook were unacceptable, and that during her 15 years of being clerk that the mistakes, “omissions and failure to follow standard procedures have resulted in wasted money as a result of, bank overdraft fees, late fees and interest and penalties and interest from state and federal agencies. Your failures, over that time period, especially never having completed an accurate bank reconciliation, has burdened the city with unnecessary financial losses in the vicinity of $200,000, which in turn has, on many occasions, causing financial hardships on the city.”
He added it was because of these hardships the city declared a financial emergency, and was forced during the first years of his administration to surplus equipment and make repayments to a number of agencies.
In December 2014 when her probation was ended and she was given four choices of about her employment in a document she also signed.
Suffridge laid out a “partial list of offenses” that tallied up to 28 at the time, and by the former mayor’s estimation cost the city “approximately $300,000 in City funds unnecessarily expended, due to the shoddy work habits over a 15 year tenure as Aragon City Clerk.”
Those four choices included immediate resignation of her position as the city clerk, immediate termination of employment with the eligibility to receive unemployment insurance, resign as city clerk and take up the positions of assistant city clerk and municipal court clerk, or take the assistant clerk and court clerk jobs at a salary of $29,000, and be able to maintain longevity, pension, vacation, sick leave and health insurance benefits.
She took the fourth option, and stayed on with the city until her resignation in April 2017.
Final years with the city
During the final two years of her employment, Judge Wheeler acted as her supervisor and gave her two performance reviews – one signed by Suffridge and the other signed by former acting Mayor Curtis Burrus, both of which said would review her salary and were middle of the road in judgment of how she undertook her duties.
Only the annual raises were ever approved for Dunn during the more than two years she served as assistant city clerk and municipal court clerk.
Then she was placed on a leave of absence in March 2017 after the city began an investigation, but then Council member and Mayor Pro Tem Tammy Mulkey couldn’t comment further about what the investigation pertained to at the time.
When she quit in the letter of resignation dated April 19, 2017, she admitted to no wrong doings whatsoever despite previous admissions of errors in her May 2012 letter to the council included in her personnel file.
She also understood that she would be paid out for her weekly pay through April 28, and any unused vacation time.
The city paid out $1,515.55 to Dunn when her employment ended totaling 118.75 hours in all.
She also received a payout for vacation hours in late 2015 after Suffridge previously pointed out that it wasn’t allowed.
Dunn received $537.21 as an “advance” for 40 unused hours of vacation time accrued in the 2015 calendar year. It was paid out to her in the final pay period of November 2016.
She also received an advance on her pay in February 2016, when she signed for a check totaling $1,015.08 from the city as an advance on her payroll for the middle of the month.
All told, Dunn was able to cash in $2,052.76 in vacation time that she didn’t use when she resigned from the city last year.
What does it all mean?
The question above is a valid one, and one that can’t yet be answered without additional documents, like a full accounting of bank records during time periods when Dunn was in charge of the finances.
Those records were previously lost due to computer crashes and a water pipe that broke and destroyed “several records” based on previous reporting.
Hatch, mentioned earlier in the story as the author of the seven-page report for Williamson and Company, said in a follow-up interview he had no opinion about what further action should be taken by the city.
He also said the city’s only request for his firm was to “look through them (the documents) and provide a report of what we observed.”
The report and in foll0w-up Hatch provides no opinion either on whether the matter should require further investigation or not.
Ultimately, their report does request the city do a better job of ensuring more than one person is responsible for the finances – which the city has done – avoid using signature stamps and other procedures to minimize the potential for lost revenue.
The report did conclude that the city “experienced lost revenue during the time frame examined due to various payments received by the City never being deposited.”
It went on to conclude that “It is also apparent that the city lacked proper internal controls related to cash receipts and disbursements such as segregation of duties, dual signature checks, and timely management review of bank statements and monthly financial reports. We believe if these controls had been implemented and operational, the inconsistencies noted from each file would have been minimal.
Questions about the city’s financial health still remain, along with gaining an understanding of the full record of Dunn’s time as the Aragon City Clerk, and more investigation by the Standard Journal is underway.
Open records requests obtained last week and including much more financial records than was initially believed to have been available were provided by the City of Aragon, but will take more time to examine. More reporting will be coming out on those documents when it is completed.
Of additional note, since Baldwin recused himself in the matter, it will be up to the council to decide if the matter requires further investigation or not. No comments have yet been sought about the documents and the report, and will be sought in the coming days.