More than $239,000 improper disbursements found in W.C. Chamber audit
More than $239,000 in improper financial disbursements were found following a special investigation of the Webster City Chamber of Commerce, according to a report released today by Auditor of State Rob Sand.
The report covered the period of Oct. 1, 2013 through June 30, 2018. The investigation was requested by Chamber officials as a result of concerns regarding certain financial transactions processed by Leah Mulholland, 39, financial and administrative assistant for the chamber.
The investigation identified $239,585.23 of improper disbursements and $23.602.83 of unsupported disbursements. Sand also reported the special investigation identified a $1,128.00 refund issued to the Chamber for overpayment of their state income tax which was not deposited into the Chamber’s bank accounts. The $239,586.23 of improper disbursements identified includes:
– $190,489.58 of payments to or for Leah Mulholland, including unauthorized checks, excess gross salary, and the Chamber’s share of payroll costs,
– $14,497.00 of transfers from the Chamber’s primary checking account to the Chamber’s “Chamber Bucks” bank account which were not approved,
– $15,725.09 of vendor payments,
– $10,086.57 of penalties and interest paid to the IRS and the Iowa Department of Revenue,
– $3,950.00 of checks redeemed for cash and cash withdrawals, and
– $4,837.99 of bank fees.
The $23,602.83 of unsupported disbursements identified includes:
– $19,422.51 of vendor payments,
– $4,058.48 of reimbursements issued to 2 former executive directors, and
– $121.84 of reimbursements issued to Ms. Mulholland.
Sand also reported it was not possible to determine if additional amounts were improperly disbursed or if additional collections were not properly deposited because adequate documentation was not available.
The report includes recommendations to strengthen the Chamber’s internal controls, such as improvements to segregation of duties, ensuring sufficient supporting documentation is maintained for all disbursements, performing receipt reconciliations, and eliminating, many of which have already been implemented, according to Colette Bertran, president of the Chamber board.
“We as a board would like to move on. We’ve been anxiously awaiting this report,” said Bertran.
She said the board and staff would be cooperating with the DCI and the attorney general’s office on the criminal case.
The Chamber office was forced to close in late June 2018 when the discrepancies were noticed.
It reopened several weeks later under a volunteer effort a few hours a day. Former employees were recruited to help answer phones, prepare the table tent calendars and send out the weekly Chamber newsletter. In December 2018, the Chamber board hired Jen Peterman as the new executive director and Denise Smith was hired in January 2019 as the membership director.
Mulholland started working at the Chamber office in October 2013 as an administrative assistant, a position she held until she was let go in late June. The Hamilton County native grew up on a farm near Duncombe and attended Webster City schools. She graduated from Buena Vista University, according to a Daily Freeman-Journal article from 2013.