Audit finds lending ceased two months after being flagged in annual review; AG office declines to prosecute
By Sarah Pridgeon
Crook County’s annual financial review has confirmed that, while the County Treasurer’s Office did continue to effectively act as a lending institution for two months after this behavior was flagged, the issues that caused concern in last year’s review appear to now have stopped.
The annual review touches on areas of county government in which departments or officials appear not to be complying with state law. Last year, Paul Stille of Leo Riley & Associates presented issues within the Treasurer’s Office that he said may rise to a level that “violates the Wyoming Constitution”.
The issue centered around the idea of extending credit to certain taxpayers by issuing tags, plates and sales tax certificate prior to payment being received; holding checks; or allowing taxpayers to postdate checks. The dollar amounts ranged from minimal to over $19,000 and the delays sometimes lasted for several months, Stille said.
This year, similar issues were noted in the audit review during the first half of the 2017 tax year, from July, 2016 until the end of January, 2017. Last year’s audit was presented in December, 2016, so much of that time period fell before the issues were identified.
The review notes instances during that time period in which checks used to pay for auto tags and sales tax certificates were held by the Treasurer’s Office for periods ranging from a few days to a few weeks.
“Checks tendered for the payment of auto tags and sales tax certificates were not being deposited in a timely manner, giving the appearance that the Treasurer had foreknowledge that these checks were written on accounts with insufficient funds,” says the review.
By doing this, the review continues, the Treasurer was, in effect, extending credit to individual taxpayers in violation of Article 16, Section 6 of the Wyoming State Constitution, which prohibits political subdivisions from loaning or giving credit to any individual, association or corporation.
The review further notes that, effective January 2017, the Treasurer’s Office instituted procedures that were designed to eliminate the lag time between the receipt and deposit of a taxpayer’s check.
The Office of the Attorney General has also responded to the special prosecution resolution received from the County Commissioners in February, which outlined “suspicious transactions” found in last year’s audit. Given the potential conflict of interest for the County Attorney’s Office, the commissioners requested the office investigate the matter.
On the basis that the Treasurer’s Office is taking steps to remedy its issues, the office will not be prosecuting.
“As a result of your request, agents with the Wyoming Division of Criminal Investigation conducted a full investigation into the areas of concern,” says Peter K. Michael, Wyoming Attorney General, in the letter.
“I have reviewed the reports generated as a result of that investigation and, at this time, I decline prosecution of this matter.”
According to Michael, his attorneys have discussed the findings with Kuhl and required that a policy be put in place to prevent the same issues from occurring again.
“Ms. Kuhl has acknowledged that she may have exercised poor judgment but [assured] me that the corrective measures in place will make sure such conduct does not happen again.”
Kuhl requested at last week’s meeting that her written response be included with this year’s audit. In that response, she states that auto tags and sales tax certificates will no longer be processed prior to funds being received.
Kuhl also states that she will request separate checks for individual transaction types from large companies so that bulk transactions no longer carry over for several days. She notes that her office has improved the payment process with the e-check ability and will follow recently adopted county policies on dishonored checks or checks with the incorrect date.