Finance officer stole thousands of dollars from small NC town, state auditor says

By Sarah Nagem

A finance officer for the Scotland County town of East Laurinburg used more than $11,000 in taxpayer money for personal utility bills and other “questionable expenses,” according to the state auditor. 

The employee, who worked for the town from December 2016 to March 2018, was not named in a report released Wednesday by the office of North Carolina Auditor Beth Wood. 

“How could this happen in a town like East Laurinburg?” Wood asked in a video released with the report. “Well, frankly, there was no oversight of how taxpayer dollars are being spent in that town. Town commissioners had no idea this was going on.” 

The report is the latest blow for East Laurinburg, home to about 300 people. Earlier this year, the N.C. Local Government Commission recommended that East Laurinburg cease to exist as a town because of its yearslong failure to submit financial audits. 

In her report, Wood suggested the local district attorney consider possible criminal charges against the former employee. 

Scotland County District Attorney Reece Saunders did not immediately return a phone call Thursday morning, and no one answered the phone at East Laurinburg’s town hall.

The finance officer is accused of using about 15% of the town’s annual budget of $75,000 for personal expenses, the report from Wood’s office shows. 

The woman did not submit receipts or other documentation to explain the spending, the report says. She is the daughter of a town commissioner, who signed 22 of 28 checks used inappropriately, according to the report. 

Wood’s office reportedly talked to the town commissioner, who said, “I can’t tell you if she had receipts or not. I just made a butt of myself and assumed that she had a receipt. I did not ask for one.” 

Here’s a breakdown of the misused funds, according to the report: 

Thirteen checks worth a total of $2,674 were used for utility payments for the finance officer’s home: $1,706 to Duke Energy and and $968 to the City of Laurinburg for water and sewer service. 

A gasoline card was used 14 times for a total of $4,102. 

Six checks worth a total of $905 made out to the finance officer had “petty cash” written on the memo line.

Seven checks worth a total of $880 had “various explanations” in the memo line, including “supplies.” 

Six checks worth a total of $895 were made out to “various vendors.”

Four checks made out to the finance officer for “additional time worked” totaled $585. 

East Laurinburg “does not have any written accounting policies and procedures,” according to the report. 

“Written policies and procedures would have increased the likelihood that the Town Council would have reviewed the Finance Officer’s spending and would have detected her personal use of Town funds or questionable expenses,” the report says. 

The town has not submitted financial audits since 2016, which is illegal in North Carolina, the report says. Local government agencies must undergo an audit each year by an outside accountant.

“As a result, there is an increased risk that fraud and accounting errors could occur and not be detected,” the report says of East Laurinburg.  

Photo by Vladimir Solomianyi on Unsplash