Damascus audit reveals undocumented spending; money unaccounted for

Arkansas legislators turned over the audit report for the city of Damascus on Thursday to the prosecutor’s office after official documents showed $9,273 in expenditures by the former police chief were not adequately documented.

 

According to the audit, a review of credit card purchases by the city’s former Police Chief Rick Perry revealed more than $9,000 of expenditures did not have any proof of validity. Mayor L.B. Pavatt is now acting police chief for the city after the Damascus City Council voted to eliminate the police chief position earlier this year. Perry’s position was dissolved during the April 11 city council meeting.

State Rep. Stephen Meeks, who represents District 67, which includes Faulkner County, said the Legislative Joint Auditing Committee noticed red flags from within the Damascus Police Department while conducting it’s review.

“Review of credit card purchases totaling $13,227 made by the Police Chief for the period November 30, 2014 through March 26, 2017, revealed $9,273 which a business purpose was not documented,” the report reads. “Without adequate supporting documentation, we were unable to determine the validity of the following purchases:

· $2,973 for unknown items, primarily purchased from Amazon.com and Walmart.

· $2,400 for grocery items.

· $2,089 for restaurant meals, most of which were in or close to the City.

· $688 for clothing/shoes.

· $596 for postal services.

· $332 for household items.

· $195 for miscellaneous items.”

The audit also revealed Perry sold two pieces of equipment without authorization.

“Body armor and a ballistic vest were sold by the Police Chief, whose position was eliminated on April 13, 2017, for $300 and $250, respectively, to two former police officers without proper authorization from the Council, as required by Ark. Code Ann. § 14-48-306,” the audit report reads.

Meeks said no other Faulkner County city was turned over to the prosecutor’s office for review following the regularly scheduled audit.

When asked if the audit committee had noticed any “red flags” like this out of Damascus in past audits, Meeks said, “no.”

“We haven’t seen anything to this nature,” he said.

The report, which was completed July 17, was sent over to the prosecutor’s office to determine if an investigation into the expenditures was necessary.

Cody Hiland, prosecutor for the 20th Judicial District, said his office received the audit report Thursday and will determine by “early next week” if an investigation by Arkansas State Police is warranted.

“My office received the legislative audit report forwarded to us yesterday,” Hiland told the Log Cabin Democrat on Friday. “We’ll review the findings and make a determination as to whether or not it’s appropriate to request an investigation by the Arkansas State police. I’ll make that decision early next week. If an investigation is conducted, we’ll let the facts gathered dictate the appropriate response from our office.”

Damascus City Attorney Beau Wilcox said the mayor and city council members would support any criminal sanctions the prosecutor’s office or other investigators may deem necessary following the review. He also said city officials have already begun work to improve their finances.

At the time Perry’s position was eliminated, Wilcox said city officials were unaware of the allegations of undocumented expenditures. The move was simply to allow the city to downsize but also allows officials to keep a closer eye on finances.

While the audit committee’s main concerns focused on the police chief’s expenditures, the audit report also cited issues with the city’s treasurer and district court clerk.

According to the audit report, the treasurer did not properly maintain documentation for its disbursements in 2015 or 2016.

The report also states the district court clerk did not perform monthly bank reconciliations from September 2016 through December 2016. Other issues against the court clerk traced back to the police department.

“The balance remaining in the Police Bond and Fine bank account was not identified with receipt numbers for cases not yet adjudicated and the payments made on all unpaid individual time accounts, as required by Ark. Code Ann. § 16-10-209,” the report reads. “The unidentified balance as of December 31, 2016 was $19,705.”

Hiland said his office will review the report as it does all regular audits. The Arkansas State Police will investigate the allegations should the prosecutor’s office recommend an investigation.

 

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