The city manager decided to suspend the court clerk, pending the results of the investigative audit. He said that he would have preferred to terminate her, but elected to wait. As a city employee, she might be more easily persuaded to be interviewed. She did speak to an audit manager and me later that week, just before she submitted her resignation. She spoke to us again shortly before we issued our report.

Fieldwork

When I arrived at Lakewood City Hall, Brenda L.’s receipt still had not arrived. The recorder was concerned that the court clerk, who had a key and the code to disarm the alarm system, would get to the fax first. However, the fax machine’s log showed that it had never arrived.

The problem was that Brenda L. had been trying to send it to a wrong number. Eventually Brenda L. called city hall and the recorder gave her the correct number. Here is the fax, with personal information redacted.

During that first day, the recorder, the bookkeeper, and I each found several similar receipts. Each should have been written for more than $100. However, the city’s copies, which were attached to the citation and in the receipt book, had blank space where the 100’s digit would be. Before the end of the first day, the three of us had found over $1,000.

Another procedure that I used and explained to the city employees who were assisting was adding each day’s receipts and tracing the totals to deposits on bank statements. I was not only interested in determining if the total traced, I also tested to determine if the total cash (meaning currency and coins) and checks matched the corresponding totals on the deposit slip. I found a few instances where the total cash in the deposit was less than the total on the underlying receipts, which meant that the total checks were greater.

I requested research from the bank, which consisted of copies of the deposit slips and contents. The copies from the bank included checks that had no corresponding receipt within the batch. Further investigation indicated that the court clerk often had access to cashier’s checks and money orders that arrived by mail to pay fines and court costs. She neglected to receipt some of the payments that arrived by mail. Then, before she prepared the deposit, she removed an equivalent amount of cash.

The Investigation to This Point

After about one week, the court clerk met an audit manager and me at city hall to discuss what I had found. At that point, I had identified slightly more than $2,000 of undeposited collections for which she was responsible. During the interview, she admitted that she sometimes borrowed money from the cash box. After the interview, she resigned from her position.

The court clerk had worked for the city for nearly three years. At that point, I had not yet examined all of the citations and receipts for the majority of the period.