Former Buffalo deputy clerk charged with misappropriating more than $42,000
A former deputy clerk for the city of Buffalo has been charged with misappropriating more than $42,000 between April 2015 and August 2018.
Riki Ellen Harrington, 46, of Blue Grass, turned herself in on Monday and appeared in front of Associate Judge Korie Talkington in Scott County Court.
She faces charges of ongoing criminal conduct, a Class B felony punishable by up to 25 years in prison, and first-degree theft, a Class C felony punishable by up to 10 years in prison.
Court records show she waived a preliminary hearing and will be arraigned May 14. She was released on her own recognizance and will be under the supervision of the Department of Correctional Services.
Harrington was a part-time deputy clerk for the city from April 6, 2015, through Aug. 23, 2018, according to an arrest affidavit filed in Scott County District Court.
During that time, she accepted cash payments from citizens and businesses for utility payments, permits, and various other city business.
According to the affidavit, Harrington misappropriated cash payments totaling approximately $42,390.12.
According to a report released Tuesday by state auditor Rob Sand:
While the city clerk was preparing for the city’s annual exam, she determined the amount of collections recorded for fines received from Scott County in fiscal year 2018 was about half of the amount received in prior years.
The city clerk contacted the Scott County Clerk of Court and obtained a listing of checks recently issued to the city and the dates they cleared the clerk of court’s bank account.
Using the redemption dates, the city clerk requested detailed deposit information from the city’s bank for selected dates and determined the checks from the Scott County Clerk of Court were deposited in the city’s bank account even though they were not recorded in the city’s accounting system.
The city clerk also determined the amount of cash deposited for the dates of Scott County checks cleared the city’s bank account was less than the amounts of cash collections recorded in the city’s receipt listings.
The city clerk contacted the mayor with the concerns she identified. The mayor reported when he and the mayor pro tem met with Harrington regarding the improperly deposited checks from the Scott County Clerk of Court, she stated she “did not remember.”
Harrington was placed on unpaid administrative leave on Aug. 23, 2018. The mayor also took her keys to City Hall and changed the passwords for the city’s accounting system when she was placed on leave.
Harrington subsequently submitted a letter of resignation effective Aug. 28, 2018. The city council accepted the resignation on Sept. 4, 2018.
The mayor then contacted police.
The Scott County Sheriff’s Office and the Office of Auditor of State were also contacted, according to the report.
Sand said in an interview with TV6 Tuesday that the audit found that throughout her employment, Harrington failed to deposit some collections that came in.
In other cases, Harrington substituted checks that came in for deposits then took the cash and did not deposit them, he said.
“One of the difficult things with cash is it's difficult to trace,” he said. “So, a lot of times with checks you're able to see what's coming and going, but your ability to do that is limited to the checks you know that are coming in. In this case, sometimes the city would be expecting a check. She would take the proceeds of that check and apply it to the utility payments that were due, but then use the utility payments that came in as cash and instead misappropriate those.”
Sand said one of the hardest things for smaller towns in Iowa to do is have appropriate segregation of duties.
“That means you want to have a lot of different people involved in handling deposits and handling cash so that you have checks and balances,” he said. “But when you're in a small town, it's just a little bit harder to find the people you need to do that work. So that's one of the problems we saw here. Buffalo, as well as a lot of other public entities in Iowa, need to work on paying special attention to.”
Sand said in his report that he identified $42,390.21 of undeposited collections, $773.77 improper disbursements, and $841.52 of unsupported disbursements.
The undeposited collections identified includes:
• $28,039.42 of checks substituted for cash collections recorded in the City’s accounting system but not deposited to the City’s bank account,
• $5,079.13 of payments posted to utility customers’ accounts which were not recorded on the daily receipt listing or deposited to the City’s bank account,
• $3,600 of security deposits for utility services recorded in the City’s accounting system which were not deposited to the City’s bank account, and
• $2,641.00 of city fees recorded in the City’s accounting system which were not deposited to the City’s bank account, according to the report.