No evidence of fraud.

That is the conclusion of the two firms that were tasked with conducting a forensic audit for the City of Fairfield.

Representatives of W.D. Brown and Associates, LLC and Nelson Forensic & Advisory Services, Bill Brown and Alan Nelson, presented their findings to the public during a Special Called Meeting, held at the Fairfield Civic Center on Tuesday, May 29, 2018.

A written report is expected to be issued later this week.

Although most municipalities have an audit conducted each year, as explained to attendees, a forensic audit looks at specific issues.

Normally, a forensic audit is conducted when specific allegations, of fraud or misdeeds, is suspected.  “In this instance, there was none,” stated Brown.

The forensic audit ordered by the Fairfield Council, however, was very broad in scope.

It covered the fiscal years ending September 30 of 2015, 2016 and 2017, plus the last three calendar months to end December 31, 2017.

As explained, the forensic auditing team was asked to look for any fraud, theft, waste, abuse or collusion by City employees during this time period.

According to the summary presented, no evidence of fraud was discovered, no intentional misdeeds by those employed by the City of Fairfield.

The team did identify instances that could be categorized as waste or abuse.

Namely, five instances of money transfers from the TDCJ – Boyd Unit to either the Enterprise Fund or the General Fund.  “These transfers do not comply with the Interlocal Agreement,” stated Brown.

Revenues from the TDCJ Fund are only supposed to be used for debt service, building of the facility, or management of the utilities.

According to Brown, one of these transfers, taking place in December of 2017, amounted to about $250,000.

The team also discovered several occasions where the purchasing policy was not strictly followed.

Additionally, they feel that the City’s lack a clearly defined conflict of interest policy could give rise to possible collusion.

Several recommendations have been made by the forensic auditing team.  They include:
–Streamline bank accounts
–Improve bank reconciliation
–Establish oversight for Municipal Court
–Establish policy for collecting vendor information
–Changing accounting firm every several years
–Make use of Hotel/Motel funds (currently over $530,000)

Following the presentation, Mayor Kenneth Hughes stated that he plans to utilize all of the recommendations to improve the City’s efficiency.

Before the meeting was adjourned, Councilman Landis Bayless reinforced that “there was no probable cause when we started this.  So, what we got was a compliance audit.  Everybody here should know that.”

Bayless also pointed out that, in addition to the $40,000 plus travel expenses, paid out to the two firms, the City of Fairfield also paid a considerable amount for time spent by City Attorney Linda Sjogren in dealing with the forensic audit.