Santa Cruz Valley Union High School District No. 840—Theft and Misuse of Public Monies (September 2007)
SUMMARY
In September 2006, the Pinal County Attorney’s Office requested that the Office of the Auditor General investigate allegations of financial misconduct by Ms. April Smith, former student activities secretary for the Santa Cruz Valley Union High School District No. 840. As a result, our Office conducted an investigation of those financial improprieties and submitted our report to the Pinal County Attorney’s Office. During our investigation, we determined that Ms. Smith embezzled and misused public money as well as falsified public records in order to conceal her crimes. The Pinal County Attorney has taken criminal action against Ms. Smith, which resulted in her indictment on felony charges. See the Conclusion on page 11 of this report.
Our investigation revealed that from February 2005 to February 2006, Ms. Smith embezzled at least $11,000 and misused an additional $7,899. This former employee used money raised by students for their activities such as prom and class trips and for uniforms to pay $11,000 worth of her personal expenses including childcare, automobile insurance, and a trip to Disneyland. Ms. Smith also misused an additional $7,899 of public money by failing to deposit student activities cash and checks into the District’s bank account. Instead, she improperly kept those receipts in her desk drawer, including some checks that were kept there for almost a year, which allowed Ms. Smith to perpetuate her theft scheme. Further, she attempted to conceal her criminal actions by producing false financial reports regarding the student activities finances.
Despite repeated recommendations from the District’s external auditors, management failed to establish appropriate safeguards over these student activities monies. The District’s lack of internal controls allowed Ms. Smith to embezzle money for a year without being detected. Ms. Smith controlled student activities cash receipts from the point of collection to deposit without any oversight. In addition, no other employee consistently reviewed the bank statements or otherwise verified reported transactions.
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