I-Team: Forensic audit reveals details about Parchment expenditures
PARCHMENT, Mich. (NEWSCHANNEL 3) - A forensic audit uncovered by the I-Team shows new details into how public tax dollars were spent on personal items by some city officials in Parchment.
This comes a few weeks after the I-Team requested that the audit be made public--after the city acknowledged mistakes were made in how public money was being spent, even if it was all paid back.
Among the findings in the Parchment forensic audit, two individuals accumulated over $1,000 of purchases over several months before repaying the city.
The audit shows charges made for food, hotels, and other personal purchases.
But there's this warning included from the auditing firm:
"It is likely additional personal purchases prior to our scope period were made."
In an interview with Newschannel 3, Parchment Mayor Robert Heasley acknowledged the personal spending is a violation of city policy and state law.
"I don't know whether the commission will take further action or not, we haven't had that discussion," he said.
Heasely is not mentioned in the report, we should point out. But the now former Parchment City Manager Dennis Durham is.
Durham resigned before the audit was made public--something the mayor hinted at.
"It would be pretty easy for someone who is watching this to do the math," Heasley said.
In his resignation letter to city officials, Durham did not mention the audit, but rather, mentioned he was not going to renew his contract with the city and depart early to pursue other opportunities.
The report says Durham, and possibly others used a city credit card to pay for cell phone bills.
According to the report, the purchase was made on the Parchment Treasurer Shannon Stutz's city credit card, but charged to Durham.
Shannon Stutz provided the following statement to Newschannel 3 after the I-Team reached out for a comment on the forensic audit:
"No money is missing from the City as a result of my actions. I did not benefit personally from any transactions nor did the volunteer organizations with which I have been affiliated. The City hired an outside accounting firm to check the City’s books, and the auditors found no money was missing. The Michigan State Police investigated and recommended no further action. My credit card use was consistent within accepted City practices at the time. This practice was not a problem in City operations or seen as such by previous audits. Going forward, I will use the credit card consistent with the auditor’s current recommendations, repeating again that the City’s finances, my personal finances and the nonprofits’ finances were not materially affected."
As for why the audit happened in the first place, it's the result of Parchment resident Michael Conner, who was concerned about what he described as a lack of transparency.
"I basically pushed them and said, well you either get a forensic audit or I'll go to the police," Conner said.
We should emphasize that although all the charges were paid back in full, the spending on personal items using city credit cards goes against both state law and Parchment policy.
It remains to be seen if the Parchment City Commission will be taking any action as a result.