Audit finds Former Acting Mayor responsible for $69,000 in misappropriated city funds
JEFFERSON CITY, Mo. (June 28, 2023) — An audit of the City of Holland released today by State Auditor Scott Fitzpatrick reveals how the former Acting Mayor failed to deposit city funds in the amount of $66,480 and misappropriated money and utility services totaling $2,549. The report also details how she violated the Missouri Constitution by hiring her daughter to serve as City Clerk. The audit gives the city a rating of “poor” and recommends the continued involvement of law enforcement for possible criminal prosecution.
“The audit uncovered an egregious breach of public trust as it appears the former Acting Mayor lined her own pockets with city funds. Her claim that the huge influx of cash into her personal account was the result of personal businesses she started does not hold up under scrutiny, and her decision to hire her own daughter as City Clerk is a blatant violation of the Missouri Constitution,” said Auditor Fitzpatrick. “The people of Holland deserve justice and my office will continue to work with the current city administration and law enforcement to ensure the former Acting Mayor is held accountable.”
The State Auditor’s Office began the audit at the request of the city’s Board of Aldermen. The audit covers the time period of January 2018 to April 2021 when Jessica Roach served as Acting Mayor of the City of Holland. During her time in office, Roach did not appoint Aldermen to fill vacant Board positions or cause a special election to be called in accordance with city code, which allowed her and the part-time City Clerks to manage the city without Board oversight.
The audit found that Acting Mayor Roach did not deposit city receipts totaling at least $66,480. She did not pay for her utility services totaling $2,036 and city property taxes totaling $213. She also improperly paid herself $300. A review of Roach’s personal bank accounts noted large cash deposits totaling $66,194 that could indicate missing city cash receipts were deposited into her personal account. In a recorded interview Roach indicated the cash deposits were a result of the sale of vaping devices, t-shirts, and fireworks. While Roach provided documentation confirming she purchased vaping devices, $41,968 of the cash deposited into her personal account occurred prior to her purchasing the devices. The Board has indicated it will work with law enforcement as recommended.
Auditors also found Acting Mayor Roach hired and paid her daughter $800 to serve as the City Clerk from February 2021 through April 2021 in violation of the Missouri Constitution. The audit also notes the current Mayor hired his sister as City Clerk in July of 2021. The Board has indicated it will work to ensure compliance with the Missouri Constitution per the recommendation of the audit.
The audit also notes the city did not have a Board of Aldermen from January 1, 2018 to April 19, 2021 to govern the city, supervise the Acting Mayor, and establish internal controls, including segregation of duties over the various financial accounting functions. The city did not obtain an annual audit of its utility system for at least the last 5 years. Additionally, the Acting Mayor, who signed checks and had access to money held in city accounts, was not covered by a bond. The city’s Board of Aldermen has indicated it will take corrective measures to address the identified issues.
Other findings in the audit include a need to improve accounting controls and procedures, as well as needed improvements for utility system controls and procedures and a need for significant improvements for city controls and procedures related to contract workers. The audit also notes city officials did not prepare a budget for four straight years from 2018 to 2021. Additionally, the audit recommends the city develop a records management and retention policy in compliance with the Missouri Secretary of State Records Services Division. The Board has responded to all recommendations by indicating it will take steps to address the identified issues.
You can read the complete audit online.