Update: Police Probe Shelton Finance Office
by Ethan Fry | Aug 24, 2012 2:26 pm
Posted to: Shelton, Shelton Investigation
State police are investigating the alleged theft of hundreds of thousands of dollars dating back to at least 2009 from the Shelton finance department, Mayor Mark Lauretti said Friday.
The city’s assistant finance director, Sharon Scanlon, resigned Thursday after Lauretti said he sent her a termination notice last week in connection with an investigation into the finance department.
Lauretti’s office issued a prepared statement Friday morning saying the city “is currently investigating the theft of public funds in our Finance Department.”
The press release said Scanlon had resigned.
Attempts to reach Scanlon Thursday and Friday were unsuccessful. The Valley Indy has sent Freedom of Information requests to the mayor’s office seeking details from her personnel file of the discipline against her, and her letter of resignation.
The alleged impropriety was brought to light by the city’s finance director, Louis Marusic, according to the CT Post.
The Post said Marusic put the misappropriation at $218,000 and that he turned documentation over to auditors.
Marusic did not return multiple calls for comment Thursday or Friday and did not answer his doorbell Friday afternoon.
In a brief interview after the press release was issued Friday morning, Lauretti said the dollar amount alleged will probably change as the investigation proceeds — but a “sizable” amount is involved.
Asked by a reporter if the amount was in the tens of thousands of dollars, Lauretti paused and said: “Hundreds.”
He added: “The number’s probably going to change, that’s why I’m reluctant to give you a number.”
“We do have nailed down a dollar amount and a time frame that spans over a couple years, I think going back to as far as ’09 right now is where we’re at,” Lauretti added.
Asked how the missing money came to light, Lauretti said: “The auditors picked up on it.”
One of the city’s auditors, David Cappelletti, of Woodbridge-based Levitsky and Berney, PC, was in City Hall Friday morning, but declined to comment to reporters.
The city’s finance department has been without its top employees this week.
Scanlon’s boss, Marusic, has been placed on paid administrative leave for an unrelated reason and “is not a suspect in this matter,” according to the statement from City Hall.
Regarding Marusic’s employment status, the mayor said that he had asked for time off to attend to a personal matter, which the mayor refused, leading to a conflict between the two.
“He did ask for time off and I wasn’t of the mind to do that and I didn’t,” the mayor said. “So I had to take an action and I did.”
Lauretti said “outside help” will be brought in to run the day-to-day operations of the finance department.
Meanwhile, the mayor said the city is trying to get the missing money back.
“The city is currently pursuing various avenues to obtain full restitution,” the press release issued by Lauretti Friday said. “A more comprehensive public statement will follow completion of this investigation. Based upon advice of Counsel, we cannot provide any more details at this time.”
The official statement from Shelton is posted below. The article continues after the document.
The assistant finance director in Shelton is a union position, according the contract between the city and U.E. Local 22.
The salary as of July 1, 2011 was $82,380, according to the union contract.
The contract states that any disciplinary action the city attempts — suspension, dismissal, demotion or reprimand — must be preceded by a letter to the employee informing he or she that an action is being considered.
The employee has the option to meet and discuss the matter with the city while accompanied by a union representative.
The employee, according to the contract, has the right to appeal any disciplinary action taken by filing a grievance.
The grievance is supposed to be filed with the mayor or the mayor’s designee within 10 working days from the date of the “event giving rise to the grievance occurred.”
The grievance, if not resolved locally, can be appealed to the state Board of Mediation and Arbitration.
Lauretti said Friday that the city followed the terms of the contract.
“You have to put people on notice that ‘Here’s what we found, you have an opportunity to defend yourself,’” the mayor said with reference to the termination notice he sent Scanlon last week. “There’s due process, and regardless of what the circumstances are, you’ve got to follow that process.”
As the news of the investigation spread Friday, city officials — those who would talk, anyway — said the allegations took them unaware.
Most took a “wait and see” approach regarding the criminal investigation and stressed that people are presumed innocent.
But some wondered what has been going on in the city’s finance office.
“I’m glad the auditors caught it this time around,” said Jack Finn, the only Democrat on the Board of Aldermen. “It’s great that they did, but how come they only caught it in 2012, and how come they didn’t find anything earlier than that when doing the audits?”
Finn said he knew both Marusic and Scanlon and that both always seemed to do their jobs well.
Judson Crawford, a Democratic member of the Board of Apportionment and Taxation, referenced the financial probes ongoing in towns throughout the Valley.
“It was a shock,” he said of the theft allegations. “I cannot even think of this happening, but what has happened in other local municipalities? And now it has hit Shelton. It’s like going down the river, as they say.”
Dave Gioiello, the chairman of the Shelton Democratic Town Committee, wondered how Lauretti didn’t know about the problems sooner.
“The mayor holds very tight reins over the city’s spending, and nothing goes out without his personal approval,” Gioiello said. “We don’t know all the circumstances, but something was going on right underneath his nose.”
The Valley Indy called Lauretti back Friday afternoon to give him an opportunity to respond. He interrupted before a reporter could finish asking him to respond to Gioiello’s comment.
“Stop right there,” Lauretti said. “I’m not even going to get involved in that conversation. Everybody’s pretty good at second-guessing and Monday-morning quarterbacking.”
He did say he’s known about the allegations “for awhile” but wouldn’t say when, specifically, he found out about them. “I don’t want to get into that because it just creates another series of questions and I’m busy right now.”
The mayor expressed confidence in the temporary help in the finance office at the moment and said the city would “absolutely” be able to meet its day-to-day financial obligations.
Republican Alderman Anthony Simonetti, who is also the head of the Republican Town Committee, said he’s confident Lauretti will handle things appropriately.
“I’m definitely concerned,” he said of the allegations, adding: “I’m sure the mayor is doing the right thing.”
“We don’t even know what point of the investigation we’re at yet,” Simonetti went on. “It’s not fair to speculate what might be going on when you don’t know. If and when things change, (Lauretti) will be forthright in telling us what’s going on, I’m sure.”
The Summer Of Alleged Corruption
The Shelton allegations are the latest in a series of incidents that are plaguing local governments in the Valley.
In Oxford, former tax collector Karen Guillet faces five years in prison after pleading guilty in July to first-degree larceny. She admitted stealing $243,902.18 from taxpayers.
In Ansonia, the state’s attorney’s office is investigating Ansonia Tax Collector Bridget Bostic after the Valley Indy published a story saying she gave out documents to city officials — and her mother — saying they had paid car taxes when, in fact, they had not paid.
In Derby, the Board of Aldermen Thursday approved a “separation agreement” for an employee in the tax office who allegedly “mishandled” cash payments from residents. A criminal investigation did not happen in Derby.
Lauretti said Friday the state police will be investigating the matter instead of the Shelton Police Department.
It is not unusual for a municipality to bring in an outside law enforcement agency to investigate serious accusations that arise involving a public employee.
In Ansonia, police Chief Kevin Hale asked the state’s attorney’s office to conduct an investigation into the city’s tax office after a report in the Valley Indy raised questions about possible wrongdoing there.
How long the Shelton investigation will last remains to be seen.
In Oxford, accusations against tax collector Guillet first surfaced on Dec. 1, 2009, and the town launched an internal probe in response to the allegations. State police first talked to town officials about the matter Jan. 19, 2010.
A detective from the Western District Major Crime Squad handled the Oxford investigation. The detective had been trained to examine financial records from the National White Collar Crime Center.
One of the earliest police actions in the Oxford investigation — they seized ribbon from Guillet’s typewriter and sent it to the state’s forensic lab for analysis.
Eventually state police accused Guillet of stealing $243,902. But criminal charges were not filed until November 2011 — just about two years after the allegations were first brought to the town’s attention.
In those two years, Guillet resigned and an internal probe worked hand in hand with state police investigators, who made repeated visits to Oxford Town Hall to review documents and to collect statements from Guillet’s co-workers.
Last month Guillet pleaded guilty to one count of first-degree larceny. She faces a maximum of five years in prison. She’ll be sentenced in October.
Eugene Driscoll contributed to this story.