The Arizona Attorney General’s Office is investigating the possibility of fraud within Duncan Town Hall.
Interim Town Manager Philip Cushman announced Friday two special agents with the AG’s Office spent a few hours reviewing electronic and paper documents in the office Thursday.
The investigation is separate from an AG’s Office investigation recently launched into a potential Arizona Open Meeting Law violations reported after a May town council meeting and it’s separate from, but related to, the ongoing Arizona Municipal Risk Retention Pool investigation launched last month at the request of the Duncan Town Council, Cushman said.
The council asked the pool to conduct a forensic investigation after a financial expert hired by the council revealed she’d found irregularities in the town’s finances, including missing cash, dozens of credit card charges not backed up with receipts, and extra payroll checks written without explanation.
The expert, Patricia Walker, also discovered none of the town’s four bank accounts had been reconciled since January, and the town is owed $137,322 in utilities bills and $98,590 of it is more than 90 days overdue.
John Basteen, interim Town manager, resigned following Walker’s investigation.
“We’re paying insurance and this is us making a claim for our insurance and if anything was stolen, or misappropriated they will immediately pay us back and they will pursue charges and all available means to recover that money,” Council member Alex Blake said in the days following the decision to reach out to the pool.
Cushman said he and the council are working to assist the special agents in any way they can to “restore the confidence, trust and reputation of town hall” with the residents of Duncan.
He’s not sure how the AG’s Office came to decide an investigation was needed.
“But, I’m not surprised. Sometimes when they hear about something of this nature they’ll launch an investigation. The surprise is why something wasn’t done earlier,” Cushman said. “Maybe it’s because the people in Phoenix are only vaguely aware we exist.”
Cushman said he is confident the investigation will be objective, but he’s not sure how long it will take.
“They’re looking at all the facts and the evidence and they’ll proceed from there,” Cushman said. “They’ll go through everything with a fine tooth comb and it’s going to be what it’s going to be.”
Cushman said anyone with information is urged to email Special Agent John Hillmann at John.Hillman@azag.gov or call 602-542-8085.
The Arizona Attorney General’s Office launched an investigation into possible open meetings violations in May at the behest of Greenlee County Sheriff Tim Sumner.
Cushman said the Town of Duncan has until mid-October to respond to the allegations.
