HomeMy WebLinkAbout1556 Christy
In Re: Dixie Christy, : File Docket: 09-008
Respondent : X-ref: Order No. 1556
: Date Decided: 4/19/10
: Date Mailed: 4/21/10
Before: Louis W. Fryman, Chair
John J. Bolger, Vice Chair
Donald M. McCurdy
Nicholas A. Colafella
Mark Volk
This is a final adjudication of the State Ethics Commission.
Procedurally, the Investigative Division of the State Ethics Commission conducted
an investigation regarding possible violation(s) of the Public Official and Employee Ethics
Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq., by the above-named Respondent. At the
commencement of its investigation, the Investigative Division served upon Respondent
written notice of the specific allegation(s). Upon completion of its investigation, the
Investigative Division issued and served upon Respondent a Findings Report identified as
an “Investigative Complaint.” An Answer was not filed and a hearing was deemed waived.
The averments in the Investigative Complaint are admitted and are set forth as the
following Findings. The record is complete.
This adjudication of the State Ethics Commission is issued under the Ethics Act and
will be made available as a public document thirty days after the mailing date noted above.
However, reconsideration may be requested. Any reconsideration request must be
received at this Commission within thirty days of the mailing date and must include a
detailed explanation of the reasons as to why reconsideration should be granted in
conformity with 51 Pa. Code § 21.29(b). A request for reconsideration will not affect the
finality of this adjudication but will defer its public release pending action on the request by
the Commission.
The files in this case will remain confidential in accordance with the Ethics Act.
Christy, 09-008
Page 2
I.ALLEGATION:
That Dixie Christy, a public official/public employee in her capacity as the
Secretary/Treasurer for Muddy Creek Township, Butler County, violated the following
provisions of the State Ethics Act (Act 93 of 1998) when she used the authority of her
public position for private pecuniary benefit by authorizing payments to her which were
neither approved nor authorized by the Township Board of Supervisors.
§ 1103. Restricted activities
(a)Conflict of interest.—
No public official or public
employee shall engage in conduct that constitutes a conflict of
interest.
65 Pa.C.S. § 1103(a).
§ 1102. Definitions
"Conflict" or "conflict of interest."
Use by a public
official or public employee of the authority of his office or
employment or any confidential information received through
his holding public office or employment for the private
pecuniary benefit of himself, a member of his immediate family
or a business with which he or a member of his immediate
family is associated. The term does not include an action
having a de minimis economic impact or which affects to the
same degree a class consisting of the general public or a
subclass consisting of an industry, occupation or other group
which includes the public official or public employee, a
member of his immediate family or a business with which he or
a member of his immediate family is associated.
65 Pa.C.S. § 1102.
II.FINDINGS:
1. The Investigative Division of the State Ethics Commission received a signed, sworn
complaint alleging that Dixie Christy violated provisions of the State Ethics Act (Act
93 of 1998).
2. Upon review of the complaint, the Investigative Division initiated a preliminary
inquiry on January 5, 2009.
3. The preliminary inquiry was completed within sixty days.
4. On March 2, 2009, a letter was forwarded to Dixie Christy by the Investigative
Division of the State Ethics Commission, informing her that a complaint against her
was received by the Investigative Division and that a full investigation was being
commenced.
a. Said letter was forwarded by certified mail, no. 7007 0220 0001 4375 0644.
b. The domestic return receipt bore the signature of D. Christy, with a delivery
date of March 5, 2009.
5. On July 1, 2009, the Investigative Division of the State Ethics Commission filed an
application for a ninety day extension of time to complete the investigation.
Christy, 09-008
Page 3
6. The Commission issued an order on July 22, 2009, granting the ninety day
extension.
7. On September 4, 2009, the Investigative Division of the State Ethics Commission
filed an application for a second ninety day extension of time to complete the
investigation.
8. The Commission issued an order on September 22, 2009, granting the ninety day
extension.
9. Periodic notice letters were forwarded to Dixie Christy in accordance with the
provisions of the Ethics Act, advising her of the general status of the investigation.
10. The Investigative Complaint/Findings Report was mailed to the Respondent on
February 23, 2010.
11. Dixie Christy served as Secretary/Treasurer for Muddy Creek Township, Butler
County, from January 2002 to October 27, 2008.
a. Christy also served as the Code Enforcement Officer, Permit Officer, and
Recording Secretary for the Planning Commission in 2005.
b. Christy resigned as Township Secretary/Treasurer on October 27, 2008.
12. Muddy Creek Township is a Second Class Township governed by a three-member
Board of Supervisors.
a. Regular meetings of the Board are held at least once a month.
1. On occasion two regular meetings are held.
2. Special meetings are held as needed throughout the year.
13. Voting at Muddy Creek Township meetings occurs via a group aye or nay vote after
a motion is made and seconded.
a. Abstentions or dissenting votes are specifically documented in the minutes.
1. Minutes of each meeting are approved for accuracy at each
subsequent meeting.
14. A listing of expenditures (bill list) is provided to the Supervisors at the regular
monthly meetings for approval.
a. Expenditures approved for payment represent all bills received/funds
expended by the Township since the previous monthly meeting.
15. Payroll issued by the Township is specifically listed on the monthly bill lists.
a. Prior to 2008, payroll was not delineated by individual on bill lists submitted
to the Board for approval.
1. Since 2008, payroll has appeared on the expenditure listings in the
form of a check register documenting the check number, date, payee,
and amount.
Christy, 09-008
Page 4
b. Prior to 2008, the bill listings indicated a total payroll amount transferred
from the general fund to the payroll fund so that individual pay checks could
be issued.
16. Township checks issued to pay the bills are signed subsequent to the vote to
approve the listing of expenditures.
a. Various checks are issued to vendors and credit card companies and for
payroll prior to a Township meeting so that late fees are not incurred and so
that payroll is timely issued.
17. All three Supervisors and the Secretary/Treasurer have signature authority over
Muddy Creek Township accounts.
a. Township checks issued to pay the bills are signed by the
Secretary/Treasurer and two Supervisors.
b. Township payroll checks are signed by the Secretary/Treasurer and one
Supervisor.
c. Facsimile stamps are not utilized.
18. The Supervisors annually appoint an individual to serve as the Township
Secretary/Treasurer.
a. The appointment normally occurs at the re-organizational meeting held in
January.
b. Christy was annually appointed/reappointed by the Board from 2002 to 2008.
19. Article VIII, Section 802 of the Second Class Township Code details the duties of
the Secretary as follows:
a. Record the proceedings of the board of supervisors and all court orders
relative to the laying out, opening and vacating of roads in a minute book.
b. Preserve the minute book and other records and turn them over to the
successor in office.
c. With the consent of the board of supervisors and in conformity with other
laws governing the retention and disposition of municipal records, have the
authority to destroy records and papers of the township other than the
minute book and account book after the lapse of six years from the date of
the records.
d. Inform supervisors of all township meetings, including special meetings of
the board of supervisors.
20. Article VII, Section 704 of the Second Class Township Code details the duties of
the Treasurer as follows:
a. Receive all moneys due the township and deposit them promptly in a
designated depository in the name of the township.
b. Keep distinct and accurate accounts of all sums received from taxes and
other sources, which accounts shall be open to the inspection of the board of
supervisors and any citizens of this Commonwealth.
Christy, 09-008
Page 5
c. Pay out all moneys of the township only on direction by the board of
supervisors.
d. Annually state the accounts and make them available to the board of
auditors for settlement.
e. Preserve the account books, papers, documents and other records of the
office and turn them over to the successor in office.
21. Christy, as the Township Secretary/Treasurer, was responsible for simultaneously
fulfilling the duties of Secretary and Treasurer. The following outlines her major
duties and responsibilities in accordance with the provisions of the Second Class
Township Code:
a. Preparation of meeting agendas, and bills to be approved by the Board;
b. Custody and maintenance of all Township financial records including making
deposits/withdrawals;
c. Preparation of checks for payment/issuance;
d. Signature authority over all Township accounts;
e. Taking minutes at monthly meetings;
f. Retention and preservation of Township documents/records;
g. Receiving and forwarding complaints to the Board of Supervisors; and
h. Various administrative duties.
22. The Board of Supervisors set the compensation for the Secretary/Treasurer position
at the annual re-organizational meetings.
a. The Secretary/Treasurer compensation was set at the following rates in
2004 through 2008:
Calendar Year Set Compensation
2004 $12.50 per hr
2005 $27,040.00 salary ($13.00/hr)
2006 $14.00 per hr
2007 $14.00 per hr
2008 $14.42 per hr
b. The Supervisors set the compensation based on a forty-hour work week.
1. Christy was to be compensated for attending Township meetings.
2. Time spent at the Township meetings was included as part of
Christy's forty-hour work week.
23. The Board did not approve for Christy to be compensated for any hours worked
over forty hours in a work week.
a. Overtime accrued by Christy was considered to be "comp time."
Christy, 09-008
Page 6
1. A "comp time" arrangement authorized by the Board permitted Christy
to take time off (that was accrued) in lieu of receiving overtime pay.
24. Christy was aware of and utilized the "comp time" system established by the
Township.
a. Christy accrued comp time and utilized comp time based upon the honor
system.
b. Christy was not required to maintain a log of “comp time” accrued or utilized.
25. The Board did not allocate any paid sick, personal, annual, and/or vacation days for
Christy’s position.
a. During the time period of 2006 through 2008, the Board approved Christy to
receive the following paid holidays off:
1. New Years Day
2. Memorial Day
3. 4th of July
4. Labor Day
5. Thanksgiving Day
6. Veteran's Day
7. Christmas Day
26. During Christy's tenure as Secretary/Treasurer, she was scheduled to work at the
Township office Monday through Thursday, from approximately 10:00 a.m. to 6:00
p.m.
a. Christy had the autonomy to schedule appointments and/or conduct
Township business at the Township office on Friday if necessary in order to
accumulate 40 hours for the work week.
b. On occasion, Christy conducted Township related business at her residence.
27. Christy typically informed Supervisor Dale Kerr via telephone if she was going to
take a day off.
a. On those occasions, a sign was put in the window of the Township office to
notify the public that the office was closed.
28. Christy was required to complete time sheets to document work completed from at
least 2002 to approximately March 2008.
a. Sections were provided on the time sheet to report the following information:
1. Name of the employee;
2. Pay period start and end date;
Christy, 09-008
Page 7
3. Start and end time for each day;
4. Regular hours, overtime hours, holiday hours, vacation hours, and/or
personal hours;
5. Signature of the employee;
6. Signature of a Supervisor; and
7. Date that the time sheet was signed by a Supervisor.
29. From 2002 to approximately March 2008, Christy recorded her hours worked on a
single time sheet for the applicable pay period.
a. The time sheets were to document work completed during a two week time
period.
1. Payroll is issued every two weeks.
b. Time sheets required the approval of one Supervisor.
30. In approximately March 2008, the Supervisors required that Christy begin utilizing a
time clock and time card to record hours worked.
a. Members of the Board of Supervisors were concerned that Christy was not
working a full 40 hour work week, but was being compensated for at least 40
hours per week.
b. Christy was to no longer document hours worked on time sheets.
31. Christy submitted her time sheets and time cards to Supervisor Dale Kerr for review
after completion.
a. Kerr was the Supervisor primarily responsible with oversight of Township
employees, including Christy.
b. Kerr signed Christy’s time sheets and time cards indicating approval by a
member of the Board.
32. Christy routinely submitted blank time sheets to Kerr for approval.
a. Christy advised Kerr that she would complete the time sheets at a later time.
1. Christy informed Kerr that she did not have time to fill out time sheets.
b. Kerr always signed the blank time sheets submitted to him by Christy.
33. Christy's time sheets and time cards were returned to her by Kerr following his
review and signature.
a. Kerr regularly returned time sheets to Christy which did not list dates and
times worked.
b. Pay issued to Christy was issued based on time sheets and later time cards.
c. Christy's time sheets were not reviewed by the full Board prior to payments
being issued to her.
Christy, 09-008
Page 8
1. Kerr primarily reviewed and signed Christy's time sheets and time
cards as he was the only Supervisor available to review time
sheets/time cards.
d. Copies of Christy's time cards were available for review at the Township
meetings.
34. The Township Supervisors took actions to approve payroll and other expenditures
based on financial information provided by Christy.
a. Christy had sole control of Township finances (i.e. bank statements,
cancelled checks, check registers, checkbooks, audit reports, etc.).
b. The Supervisors trusted Christy and did not challenge Christy's actions or
explanations regarding finances.
c. The Supervisors, particularly Supervisor Kerr, would sign blank checks upon
Christy's request.
1. Christy informed the Supervisors that the blank checks were going to
be used to pay expected bills and payroll between meetings of the
Board.
2. Blank checks were also signed because of problems/difficulties
Christy alleged were occurring with the RA Services Software.
aa. RA Services Software was the computer program utilized by
the Township to generate checks.
35. From the time period of 2004 to late October 2008 various bank accounts existed in
the name of Muddy Creek Township at First National Bank including the following:
Account Number Account Name
XXX036 Highway Aid Fund
XXXXX201 Fire Fund
XXX002 Payroll Fund
XXX028 General Fund
XXXXX208 Building Fund
a. Employee payroll checks, including Christy's, were issued out of the Payroll
Fund.
b. Reimbursement checks, including Christy’s were issued from the General
Fund.
36. The process of issuing payroll for Muddy Creek Township employees remained
consistent from 2004 to late 2008 and is noted as follows.
a. Pay periods began on Monday and ended on Sunday.
b. Payroll was issued bi-weekly on or about the last workday of the pay period
(normally Thursday or Friday).
1. Instances exist in which payroll was issued on the Monday following
the end of a pay period.
Christy, 09-008
Page 9
c. A maximum of twenty-six payroll checks were due to be issued each year for
township employees.
37. Christy generated payroll checks and the expenditure listings (bill lists) subsequent
to the approval of time sheets and time cards by Kerr.
a. The payroll and expenditures were to be submitted to the Board for approval.
1. Payroll checks were routinely issued by Christy prior to Board
approval as pay days would occur in between Board meetings when
approvals were to be made.
b. Christy utilized a computer software called RA Services Software to generate
the payroll checks and expenditure listings that were approved at the regular
meetings.
c. Christy was the only Township employee/official trained to utilize the RA
Services Software.
d. Payroll checks were issued from account no. XXX002 at First National Bank.
38. Payroll checks routinely contained only the signatures of Christy and Supervisor
Kerr.
a. As the Supervisor most readily available, Christy would contact Kerr to sign
checks.
b. Kerr regularly signed blank payroll and general fund checks at Christy’s
request.
1. Christy would advise Kerr that signed blank checks were necessary to
issue payroll and pay bills between Board meetings.
2. Christy also told Kerr that she was experiencing difficulties with the
RA Services software creating the need for him to sign blank checks.
39. Between January 2005 and October 2008, Christy would regularly issue payments
to herself without Board approvals which were unrelated to any of her Township
duties and responsibilities.
a. Christy was not eligible to receive any payments other than her approved bi-
weekly compensation.
b. Christy submitted blank time sheets to Kerr for approval and issued
payments to herself based on bogus time sheets.
c. Christy then would issue checks to herself without Board approval by
submitting blank checks to Supervisor Dale Kerr to sign.
1. Christy would then make checks payable to her and sign the checks
as the second authorized signatory.
40. Christy has maintained a bank account at First National Bank since at least 2004.
a. Christy's bank account number is XXX112.
b. Christy and her husband, Dean Christy, have signature authority over the
Christy, 09-008
Page 10
account.
41. The twenty-six pay periods for Muddy Creek Township in 2005 were identified as
follows:
Pay Period
1. 12-27-04 to 1-9-05
2. 1-10-05 to 1-23-05
3. 1-24-05 to 2-6-05
4. 2-7-05 to 2-20-05
5. 2-21-05 to 3-6-05
6. 3-7-05 to 3-20-05
7. 3-21-05 to 4-3-05
8. 4-4-05 to 4-17-05
9. 4-18-05 to 5-1-05
10. 5-2-05 to 5-15-05
11. 5-16-05 to 5-29-05
12. 5-30-05 to 6-12-05
13. 6-13-05 to 6-26-05
14. 6-27-05 to 7-10-05
15. 7-11-05 to 7-24-05
16. 7-25-05 to 8-7-05
17. 8-8-05 to 8-21-05
18. 8-22-05 to 9-4-05
19. 9-5-05 to 9-18-05
20. 9-19-05 to 10-2-05
21. 10-3-05 to 10-16-05
22. 10-17-05 to 10-30-05
23. 10-31-05 to 11-13-05
24. 11-14-05 to 11-27-05
25. 11-28-05 to 12-11-05
26. 12-12-05 to 12-25-05
42. In 2005 Christy issued (35) payroll checks to her even though there were only (26)
pay periods.
a. Christy's time sheets covering the time period of 2005 were not on file at the
township building.
43. In 2005, Christy issued herself the following thirty-five payroll checks for services
allegedly performed as Muddy Creek Township Secretary/Treasurer:
Township Pay Period/Explanation
Check Check Check
# Date Amount Signatures
5070 1-4-05 $909.74 Christy, Dale Kerr 1. 12-27-04 to 1-9-05
5089 1-20-05 $927.57 Christy, Dale Kerr 2. 1-10-05 to 1-23-05
5100 2-3-05 $927.57 Christy, Dale Kerr 3. 1-24-05 to 2-6-05
5107 2-17-05 $927.57 Christy, Dale Kerr 4. 2-7-05 to 2-20-05
5115 3-3-05 $927.57 Christy, Dale Kerr 5. 2-21-05 to 3-6-05
5118 3-17-05 $927.57 Christy, Dale Kerr 6. 3-7-05 to 3-20-05
5121 3-21-05 $927.57 Christy, Dale Kerr Additional pay check
5125 3-31-05 $927.57 Christy, Dale Kerr 7. 3-21-05 to 4-3-05
5139 4-5-05 $927.57 Christy, Dale Kerr Additional pay check
5140 4-14-05 $927.57 Christy, Dale Kerr 8. 4-4-05 to 4-17-05
Christy, 09-008
Page 11
5147 4-21-05 $927.57 Christy, Dale Kerr 9. 4-18-05 to 5-1-05
5148 4-28-05 $927.57 Christy, Dale Kerr Additional pay check
5154 5-12-05 $927.57 Christy, Dale Kerr 10. 5-2-05 to 5-15-05
5163 5-26-05 $927.57 Christy, Dale Kerr 11. 5-16-05 to 5-29-05
5166 6-9-05 $927.57 Christy, Dale Kerr 12. 5-30-05 to 6-12-05
5168 6-23-05 $927.57 Christy, Dale Kerr 13. 6-13-05 to 6-26-05
5191 7-6-05 $927.57 Christy, Dale Kerr 14. 6-27-05 to 7-10-05
5196 7-21-05 $927.57 Christy, Dale Kerr 15. 7-11-05 to 7-24-05
5205 8-4-05 $927.57 Christy, Dale Kerr 16. 7-25-05 to 8-7-05
5198 8-18-05 $927.57 Christy, Dale Kerr 17. 8-8-05 to 8-21-05
5216 8-22-05 $927.57 Christy, Dale Kerr Additional pay check
5209 9-1-05 $927.57 Christy, Dale Kerr 18. 8-22-05 to 9-4-05
5221 9-6-05 $927.57 Christy, Dale Kerr Additional pay check
5222 9-15-05 $927.57 Christy, Dale Kerr 19. 9-5-05 to 9-18-05
5229 9-28-05 $927.57 Christy, Dale Kerr 20. 9-19-05 to 10-2-05
5233 10-12-05 $927.57 Christy, Dale Kerr 21. 10-3-05 to 10-16-05
5254 10-25-05 $927.57 Christy, Dale Kerr 22. 10-17-05 to 10-30-05
5257 11-8-05 $927.57 Christy, Dale Kerr 23. 10-31-05 to 11-13-05
5263 11-28-05 $927.57 Christy, Dale Kerr 24. 11-14-05 to 11-27-05
5266 11-29-05 $927.57 Christy, Dale Kerr Additional pay check
5267 12-7-05 $927.57 Christy, Dale Kerr Additional pay check
5268 12-8-05 $927.57 Christy, Dale Kerr 25. 11-28-05 to 12-11-05
5269 12-20-05 $875.57 Christy, Dale Kerr Additional pay check
5282 12-23-05 $917.57 Christy, Dale Kerr 26. 12-12-05 to 12-25-05
5289 12-27-05 $927.57 Christy, Dale Kerr Additional pay check
Total $32,385.12
a. Christy received $32,385.12 (net) for hours claimed to have been worked as
Secretary/Treasurer.
1. Christy's wage was set at $13.00 an hour in 2005 (see, Finding no.
22).
2. The maximum amount (gross) Christy was to receive was $27,040.00
based on her (13.00 [hourly rate] x 40 [hours per work week] x 52
[work weeks] = 27,040).
b. None of the checks issued to Christy were individually approved by the
Board of Supervisors.
1. Payroll was approved by the Board as a lump sum.
44. W-2 Wage and Tax Statements for 2005 issued by Muddy Creek Township
confirmed total compensation for Christy as $36,380.00.
45. Christy issued herself nine paychecks in 2005 totaling $8,296.13 (net) as indicated
below which were not related to her Township position and do not correspond to
Township pay days.
a. Christy prepared all of the checks issued to her and signed the checks as an
authorized signatory of the Township.
Township Pay Period/Explanation
Check Check Check
# Date Amount Signatures
5121 3-21-05 $927.57 Christy, Dale Kerr Additional pay check
Christy, 09-008
Page 12
5139 4-5-05 $927.57 Christy, Dale Kerr Additional pay check
5148 4-28-05 $927.57 Christy, Dale Kerr Additional pay check
5216 8-22-05 $927.57 Christy, Dale Kerr Additional pay check
5221 9-6-05 $927.57 Christy, Dale Kerr Additional pay check
5266 11-29-05 $927.57 Christy, Dale Kerr Additional pay check
5267 12-7-05 $927.57 Christy, Dale Kerr Additional pay check
5269 12-20-05 $875.57 Christy, Dale Kerr Additional pay check
5289 12-27-05 $927.57 Christy, Dale Kerr Additional pay check
Total $8,296.13
46. Christy deposited 34 of the 35 payroll checks received in 2005 to her personal bank
account at First National Bank as shown below:
Township Date Deposited
Check Check Check
# Date Amount Signatures
5070 1-4-05 $909.74 Christy, Dale Kerr 1-4-05
5089 1-20-05 $927.57 Christy, Dale Kerr 1-20-05
5100 2-3-05 $927.57 Christy, Dale Kerr 2-4-05
5107 2-17-05 $927.57 Christy, Dale Kerr 2-17-05
5115 3-3-05 $927.57 Christy, Dale Kerr 3-3-05
5118 3-17-05 $927.57 Christy, Dale Kerr 3-17-05
5121 3-21-05 $927.57 Christy, Dale Kerr 3-23-05
5125 3-31-05 $927.57 Christy, Dale Kerr 3-31-05
5139 4-5-05 $927.57 Christy, Dale Kerr 4-5-05
5140 4-14-05 $927.57 Christy, Dale Kerr 4-18-05
5147 4-21-05 $927.57 Christy, Dale Kerr 4-21-05
5148 4-28-05 $927.57 Christy, Dale Kerr 4-28-05
5154 5-12-05 $927.57 Christy, Dale Kerr 5-12-05
5163 5-26-05 $927.57 Christy, Dale Kerr 5-26-05
5166 6-9-05 $927.57 Christy, Dale Kerr 6-9-05
5168 6-23-05 $927.57 Christy, Dale Kerr 6-23-05
5191 7-6-05 $927.57 Christy, Dale Kerr 7-6-05
5196 7-21-05 $927.57 Christy, Dale Kerr 7-21-05
5205 8-4-05 $927.57 Christy, Dale Kerr 8-4-05
5198 8-18-05 $927.57 Christy, Dale Kerr 8-18-05
5216 8-22-05 $927.57 Christy, Dale Kerr 8-24-05
5209 9-1-05 $927.57 Christy, Dale Kerr 9-1-05
5221 9-6-05 $927.57 Christy, Dale Kerr Cashed
5222 9-15-05 $927.57 Christy, Dale Kerr 9-16-05
5229 9-28-05 $927.57 Christy, Dale Kerr 9-28-05
5233 10-12-05 $927.57 Christy, Dale Kerr 10-12-05
5254 10-25-05 $927.57 Christy, Dale Kerr 10-25-05
5257 11-8-05 $927.57 Christy, Dale Kerr 11-8-05
5263 11-28-05 $927.57 Christy, Dale Kerr 11-30-05
5266 11-29-05 $927.57 Christy, Dale Kerr 11-30-05
5267 12-7-05 $927.57 Christy, Dale Kerr 12-6-05
5268 12-8-05 $927.57 Christy, Dale Kerr 12-8-05
5269 12-20-05 $875.57 Christy, Dale Kerr 12-20-05
5282 12-23-05 $917.57 Christy, Dale Kerr 12-23-05
Christy, 09-008
Page 13
5289 12-27-05 $927.57 Christy, Dale Kerr 1-3-06
Total $32,385.12
a. Christy deposited eight of the nine unauthorized paychecks (indicated by the
shaded areas in the above chart) into her personal First National Bank
account.
1. Christy cashed the paycheck represented by check # 5221.
47. Christy realized a financial gain of $9,340.00 ($8,296.13 net) in 2005 when she
issued and signed payroll checks compensating herself for pay periods not
approved by the Board of Supervisors.
48. Twenty-six pay periods for Muddy Creek Township in 2006 occurred as follows:
Pay Period
1. 12-26-05 to 1-8-06
2. 1-9-06 to 1-22-06
3. 1-23-06 to 2-5-06
4. 2-6-06 to 2-19-06
5. 2-20-06 to 3-5-06
6. 3-6-06 to 3-19-06
7. 3-20-06 to 4-2-06
8. 4-3-06 to 4-16-06
9. 4-17-06 to 4-30-06
10. 5-1-06 to 5-14-06
11. 5-15-06 to 5-28-06
12. 5-29-06 to 6-11-06
13. 6-12-06 to 6-25-06
14. 6-26-06 to 7-9-06
15. 7-10-06 to 7-23-06
16. 7-24-06 to 8-6-06
17. 8-7-06 to 8-20-06
18. 8-21-06 to 9-3-06
19. 9-4-06 to 9-17-06
20. 9-18-06 to 10-1-06
21. 10-2-06 to 10-15-06
22. 10-16-06 to 10-29-06
23. 10-30-06 to 11-12-06
24. 11-13-06 to 11-26-06
25. 11-27-06 to 12-10-06
26. 12-11-06 to 12-24-06
49. Christy issued (64) paychecks to herself in 2006 as payment for her
Secretary/Treasurer duties.
a. No other Township employees were issued more than (26) paychecks.
b. Only two time sheets were on file for Christy for calendar year 2006 as
shown below:
Pay Period Hours Indicated Employee Approved Paid by Check
on Time Signature by Township Amount
sheets/Time Signature of Check #
Cards Supervisor
Christy, 09-008
Page 14
Pay Period Hours Indicated Employee Approved Paid by Check
on Time Signature by Township Amount
sheets/Time Signature of Check #
Cards Supervisor
5-1-06 to 5-14-06 80 Christy Dale Kerr 5370 $860.38
8-21-06 to 9-3-06 81.5 (paid for 80) Christy Not Signed 5448 $860.38
c. As Secretary/Treasurer, Christy was responsible for completing time sheets
for Supervisor review and approval and maintaining those time sheets.
50. Christy issued herself the following sixty-four pay checks during 2006 for services
allegedly performed as the Township Secretary/Treasurer:
Township Check Check Pay Period/Explanation
Check # Date Amount Signatures
5290 1-6-06 $1,064.48 Christy, Dale Kerr 1. 12-26-05 to 1-8-06
5295 1-12-06 $927.57 Christy, Dale Kerr Additional pay check
5300 1-23-06 $998.93 Christy, Dale Kerr 2. 1-9-06 to 1-22-06
5303 2-1-06 $927.57 Christy, Dale Kerr Additional pay check
5304 2-6-06 $998.93 Christy, Dale Kerr 3. 1-23-06 to 2-5-06
5313 2-13-06 $927.57 Christy, Dale Kerr Additional pay check
5315 2-20-06 $998.93 Christy, Dale Kerr 4. 2-6-06 to 2-19-06
5327 3-2-06 $927.57 Christy, Dale Kerr Additional pay check
5328 3-6-06 $998.93 Christy, Dale Kerr 5. 2-20-06 to 3-5-06
5331 3-10-06 $927.57 Christy, Dale Kerr Additional pay check
5333 3-17-06 $998.93 Christy, Dale Kerr 6. 3-6-06 to 3-19-06
5338 3-22-06 $1,391.37 Christy, Dale Kerr Additional pay check
5346 3-31-06 $998.93 Christy, Dale Kerr 7. 3-20-06 to 4-2-06
5349 4-5-06 $927.57 Christy, Dale Kerr Additional pay check
5350 4-12-06 $998.93 Christy, Dale Kerr Additional pay check
5357 4-14-06 $998.93 Christy, Dale Kerr 8. 4-3-06 to 4-16-06
5353 4-20-06 $998.93 Christy, Dale Kerr Additional pay check
5354 4-27-06 $998.93 Christy, Dale Kerr 9. 4-17-06 to 4-30-06
5364 5-1-06 $998.93 Christy, Dale Kerr Additional pay check
5369 5-4-06 $998.93 Christy, Dale Kerr Additional pay check
5370 5-12-06 $998.93 Christy, Dale Kerr 10. 5-1-06 to 5-14-06
5355 5-17-06 $998.93 Christy, Dale Kerr Additional pay check
5374 5-24-06 $998.93 Christy, Dale Kerr Additional pay check
5375 5-25-06 $998.93 Christy, Dale Kerr 11. 5-15-06 to 5-28-06
5356 6-5-06 $998.93 Christy, Dale Kerr Additional pay check
5379 6-9-06 $998.93 Christy, Dale Kerr 12. 5-29-06 to 6-11-06
5387 6-20-06 $998.93 Christy, Dale Kerr Additional pay check
5388 6-22-06 $998.93 Christy, Dale Kerr 13. 6-12-06 to 6-25-06
5392 6-29-06 $998.93 Christy, Dale Kerr Additional pay check
5393 7-6-06 $998.93 Christy, Dale Kerr 14. 6-26-06 to 7-9-06
5404 7-14-06 $860.38 Christy, Dale Kerr Additional pay check
5403 7-21-06 $860.38 Christy, Dale Kerr 15. 7-10-06 to 7-23-06
5405 7-22-06 $860.38 Christy, Dale Kerr Additional pay check
5432 8-2-06 $860.38 Christy, Dale Kerr Additional pay check
5435 8-4-06 $860.38 Christy, Dale Kerr 16. 7-24-06 to 8-6-06
Christy, 09-008
Page 15
5433 8-8-06 $860.38 Christy, Dale Kerr Additional pay check
5443 8-17-06 $860.38 Christy, Jay Grinnell 17. 8-7-06 to 8-20-06
5446 8-25-06 $860.38 Christy, Dale Kerr Additional pay check
5447 8-31-06 $860.38 Christy, Dale Kerr Additional pay check
5448 9-5-06 $860.38 Christy, Dale Kerr 18. 8-21-06 to 9-3-06
5451 9-12-06 $860.38 Christy, Dale Kerr Additional pay check
5456 9-18-06 $860.38 Christy, Dale Kerr 19. 9-4-06 to 9-17-06
5460 9-21-06 $860.38 Christy, Dale Kerr Additional pay check
5452 9-26-06 $860.38 Christy, Dale Kerr Additional pay check
5473 9-29-06 $860.38 Christy, Dale Kerr 20. 9-18-06 to 10-1-06
5476 10-3-06 $860.38 Christy, Dale Kerr Additional pay check
5467 10-10-06 $860.38 Christy, Dale Kerr Additional pay check
5480 10-13-06 $860.38 Christy, Dale Kerr 21. 10-2-06 to 10-15-06
5483 10-20-06 $860.38 Christy, Dale Kerr Additional pay check
5484 10-26-06 $860.38 Christy, Dale Kerr 22. 10-16-06 to 10-29-06
5485 10-30-06 $860.38 Christy, Dale Kerr Additional pay check
5488 11-3-06 $860.38 Christy, Dale Kerr Additional pay check
5491 11-9-06 $860.38 Christy, Dale Kerr 23. 10-30-06 to 11-12-06
5494 11-14-06 $860.38 Christy, Dale Kerr Additional pay check
5498 11-20-06 $860.38 Christy, Dale Kerr Additional pay check
5499 11-22-06 $860.38 Christy, Dale Kerr 24. 11-13-06 to 11-26-06
5503 11-29-06 $860.38 Christy, Dale Kerr Additional pay check
5504 12-4-06 $860.38 Christy, Dale Kerr Additional pay check
5507 12-8-06 $860.38 Christy, Dale Kerr 25. 11-27-06 to 12-10-06
5506 12-12-06 $860.38 Christy, Dale Kerr Additional pay check
5513 12-15-06 $860.38 Christy, Dale Kerr Additional pay check
5514 12-20-06 $860.38 Christy, Dale Kerr Additional pay check
5515 12-21-06 $860.38 Christy, Dale Kerr Additional pay check
5516 12-22-06 $860.38 Christy, Dale Kerr 26. 12-11-06 to 12-24-06
Total $59,250.65
a. Christy received net compensation of $59,250.65 in 2006 as a result of the
(64) paychecks issued to her.
b. Christy’s total compensation for 2006, as approved by the Board, was
$29,120.00.
1. Christy's wage was set at $14.00 an hour in 2006 (see, Finding no.
22).
2. The maximum amount (gross) Christy could receive was $29,120.00
based on her hourly rate of (14.00/hour x 40 [hours per work week] x
52 [work weeks] = 29,120).
c. None of the checks issued to Christy were individually approved by the
Board of Supervisors.
1. Payroll was approved by the Board as a lump sum.
51. W-2 Wage and Tax Statements for 2006 issued to Christy confirmed compensation
totaling $71,713.50.
Christy, 09-008
Page 16
a. Christy overpaid herself $42,593.50 in 2006 computed as follows:
W-2 form: $ 71,713.50
Approved Amount: $ 29,120.00
$ 42,593.50
52. Christy issued and signed as a Township official thirty-eight additional unauthorized
paychecks in 2006 totaling $34,875.52 (net) indicated in the chart below:
Township Check Check Pay
Check # Date Amount Signatures Period/Explanation
5295 1-12-06 $927.57 Christy, Dale Kerr Additional pay check
5303 2-1-06 $927.57 Christy, Dale Kerr Additional pay check
5313 2-13-06 $927.57 Christy, Dale Kerr Additional pay check
5327 3-2-06 $927.57 Christy, Dale Kerr Additional pay check
5331 3-10-06 $927.57 Christy, Dale Kerr Additional pay check
5338 3-22-06 $1,391.37 Christy, Dale Kerr Additional pay check
5349 4-5-06 $927.57 Christy, Dale Kerr Additional pay check
5350 4-12-06 $998.93 Christy, Dale Kerr Additional pay check
5353 4-20-06 $998.93 Christy, Dale Kerr Additional pay check
5364 5-1-06 $998.93 Christy, Dale Kerr Additional pay check
5369 5-4-06 $998.93 Christy, Dale Kerr Additional pay check
5355 5-17-06 $998.93 Christy, Dale Kerr Additional pay check
5374 5-24-06 $998.93 Christy, Dale Kerr Additional pay check
5356 6-5-06 $998.93 Christy, Dale Kerr Additional pay check
5387 6-20-06 $998.93 Christy, Dale Kerr Additional pay check
5392 6-29-06 $998.93 Christy, Dale Kerr Additional pay check
5404 7-14-06 $860.38 Christy, Dale Kerr Additional pay check
5405 7-22-06 $860.38 Christy, Dale Kerr Additional pay check
5432 8-2-06 $860.38 Christy, Dale Kerr Additional pay check
5433 8-8-06 $860.38 Christy, Dale Kerr Additional pay check
5446 8-25-06 $860.38 Christy, Dale Kerr Additional pay check
5447 8-31-06 $860.38 Christy, Dale Kerr Additional pay check
5451 9-12-06 $860.38 Christy, Dale Kerr Additional pay check
5460 9-21-06 $860.38 Christy, Dale Kerr Additional pay check
5452 9-26-06 $860.38 Christy, Dale Kerr Additional pay check
5476 10-3-06 $860.38 Christy, Dale Kerr Additional pay check
5467 10-10-06 $860.38 Christy, Dale Kerr Additional pay check
5483 10-20-06 $860.38 Christy, Dale Kerr Additional pay check
5485 10-30-06 $860.38 Christy, Dale Kerr Additional pay check
5488 11-3-06 $860.38 Christy, Dale Kerr Additional pay check
5494 11-14-06 $860.38 Christy, Dale Kerr Additional pay check
5498 11-20-06 $860.38 Christy, Dale Kerr Additional pay check
5503 11-29-06 $860.38 Christy, Dale Kerr Additional pay check
5504 12-4-06 $860.38 Christy, Dale Kerr Additional pay check
5506 12-12-06 $860.38 Christy, Dale Kerr Additional pay check
5513 12-15-06 $860.38 Christy, Dale Kerr Additional pay check
5514 12-20-06 $860.38 Christy, Dale Kerr Additional pay check
5515 12-21-06 $860.38 Christy, Dale Kerr Additional pay check
Total $34,875.52
Christy, 09-008
Page 17
53. Christy deposited all sixty-four payroll checks including the unauthorized payments
she received in 2006 into her personal bank account at First National Bank as
shown below:
Township Check Check Date
Check # Date Amount Signatures Deposited
5290 1-6-06 $1,064.48 Christy, Dale Kerr 1-6-06
5295 1-12-06 $927.57 Christy, Dale Kerr 1-19-06
5300 1-23-06 $998.93 Christy, Dale Kerr 1-23-06
5303 2-1-06 $927.57 Christy, Dale Kerr 2-1-06
5304 2-6-06 $998.93 Christy, Dale Kerr 2-6-06
5313 2-13-06 $927.57 Christy, Dale Kerr 2-16-06
5315 2-20-06 $998.93 Christy, Dale Kerr 2-21-06
5327 3-2-06 $927.57 Christy, Dale Kerr 3-2-06
5328 3-6-06 $998.93 Christy, Dale Kerr 3-6-06
5331 3-10-06 $927.57 Christy, Dale Kerr 3-14-06
5333 3-17-06 $998.93 Christy, Dale Kerr 3-17-06
5338 3-22-06 $1,391.37 Christy, Dale Kerr 3-22-06
5346 3-31-06 $998.93 Christy, Dale Kerr 3-31-06
5349 4-5-06 $927.57 Christy, Dale Kerr 4-5-06
5350 4-12-06 $998.93 Christy, Dale Kerr 4-12-06
5357 4-14-06 $998.93 Christy, Dale Kerr 4-17-06
5353 4-20-06 $998.93 Christy, Dale Kerr 4-20-06
5354 4-27-06 $998.93 Christy, Dale Kerr 4-27-06
5364 5-1-06 $998.93 Christy, Dale Kerr 5-1-06
5369 5-4-06 $998.93 Christy, Dale Kerr 5-4-06
5370 5-12-06 $998.93 Christy, Dale Kerr 5-12-06
5355 5-17-06 $998.93 Christy, Dale Kerr 5-17-06
5374 5-24-06 $998.93 Christy, Dale Kerr 5-24-06
5375 5-25-06 $998.93 Christy, Dale Kerr 5-25-06
5356 6-5-06 $998.93 Christy, Dale Kerr 6-5-06
5379 6-9-06 $998.93 Christy, Dale Kerr 6-9-06
5387 6-20-06 $998.93 Christy, Dale Kerr 6-20-06
5388 6-22-06 $998.93 Christy, Dale Kerr 6-22-06
5392 6-29-06 $998.93 Christy, Dale Kerr 6-29-06
5393 7-6-06 $998.93 Christy, Dale Kerr 7-7-06
5404 7-14-06 $860.38 Christy, Dale Kerr 7-18-06
5403 7-21-06 $860.38 Christy, Dale Kerr 7-21-06
5405 7-22-06 $860.38 Christy, Dale Kerr 7-22-06
5432 8-2-06 $860.38 Christy, Dale Kerr 8-2-06
5435 8-4-06 $860.38 Christy, Dale Kerr 8-4-06
5433 8-8-06 $860.38 Christy, Dale Kerr 8-9-06
5443 8-17-06 $860.38 Christy, Jay Grinnell 8-21-06
5446 8-25-06 $860.38 Christy, Dale Kerr 8-25-06
5447 8-31-06 $860.38 Christy, Dale Kerr 8-31-06
5448 9-5-06 $860.38 Christy, Dale Kerr 9-5-06
5451 9-12-06 $860.38 Christy, Dale Kerr 9-12-06
5456 9-18-06 $860.38 Christy, Dale Kerr 9-18-06
Christy, 09-008
Page 18
5460 9-21-06 $860.38 Christy, Dale Kerr 9-21-06
5452 9-26-06 $860.38 Christy, Dale Kerr 9-28-06
5473 9-29-06 $860.38 Christy, Dale Kerr 10-5-06
5476 10-3-06 $860.38 Christy, Dale Kerr 10-3-06
5467 10-10-06 $860.38 Christy, Dale Kerr 10-12-06
5480 10-13-06 $860.38 Christy, Dale Kerr 10-16-06
5483 10-20-06 $860.38 Christy, Dale Kerr 10-20-06
5484 10-26-06 $860.38 Christy, Dale Kerr 10-26-06
5485 10-30-06 $860.38 Christy, Dale Kerr 10-31-06
5488 11-3-06 $860.38 Christy, Dale Kerr 11-3-06
5491 11-9-06 $860.38 Christy, Dale Kerr 11-9-06
5494 11-14-06 $860.38 Christy, Dale Kerr 11-14-06
5498 11-20-06 $860.38 Christy, Dale Kerr 11-22-06
5499 11-22-06 $860.38 Christy, Dale Kerr 11-22-06
5503 11-29-06 $860.38 Christy, Dale Kerr 11-29-06
5504 12-4-06 $860.38 Christy, Dale Kerr 12-5-06
5507 12-8-06 $860.38 Christy, Dale Kerr 12-8-06
5506 12-12-06 $860.38 Christy, Dale Kerr 12-12-06
5513 12-15-06 $860.38 Christy, Dale Kerr 12-15-06
5514 12-20-06 $860.38 Christy, Dale Kerr 12-20-06
5515 12-21-06 $860.38 Christy, Dale Kerr 21-21-06
5516 12-22-06 $860.38 Christy, Dale Kerr 12-22-06
Total $59,250.65
54. Christy realized a financial gain of $42,593.50 ($34,875.52 net) in 2006 when she
prepared, signed and issued unauthorized payroll checks to herself that were not
approved by the Board of Supervisors:
W-2 Compensation $71,713.50
Approved Compensation -$29,120.00
$42,593.50
55. The twenty-six pay periods for Muddy Creek Township in 2007 were as follows:
Pay Period
1. 12-25-06 to 1-7-07
2. 1-8-07 to 1-21-07
3. 1-22-07 to 2-4-07
4. 2-5-07 to 2-18-07
5. 2-19-07 to 3-4-07
6. 3-5-07 to 3-18-07
7. 3-19-07 to 4-1-07
8. 4-2-07 to 4-15-07
9. 4-16-07 to 4-29-07
10. 4-30-07 to 5-13-07
11. 5-14-07 to 5-27-07
12. 5-28-07 to 6-10-07
13. 6-11-07 to 6-24-07
14. 6-25-07 to 7-8-07
15. 7-9-07 to 7-22-07
16. 7-23-07 to 8-5-07
17. 8-6-07 to 8-19-07
Christy, 09-008
Page 19
18. 8-20-07 to 9-2-07
19. 9-3-07 to 9-16-07
20. 9-17-07 to 9-30-07
21. 10-1-07 to 10-14-07
22. 10-15-07 to 10-28-07
23. 10-29-07 to 11-11-07
24. 11-12-07 to 11-25-07
25. 11-26-07 to 12-9-07
26. 12-10-07 to 12-23-07
56. In 2007, Christy recorded and submitted (26) time sheets listing hours worked for
payment in her capacity as Secretary/Treasurer for calendar year 2007 as shown
below:
Pay Period Hours Indicated Employee Approved Paid by Check
on Time Signature by Township Amount
sheets/Time on Time Signature Check #
Cards sheet of
Supervisor
1. 12-25-06 to 1-7-07 88.5 (paid for 80) Christy Dale Kerr 5520 $860.58
2. 1-8-07 to 1-21-07 80 Christy Dale Kerr 5542 $860.58
3. 1-22-07 to 2-4-07 79.5 (paid for 80) Christy Dale Kerr 5558 $860.58
4. 2-5-07 to 2-18-07 80.5 (paid for 80) Christy Dale Kerr 5564 $860.58
5. 2-19-07 to 3-4-07 83 (paid for 80) Christy Dale Kerr 5572 $860.58
6. 3-5-07 to 3-18-07 80 Christy Dale Kerr 5576 $860.58
7. 3-19-07 to 4-1-07 82 (paid for 80) Christy Not Signed 5583 $860.58
8. 4-2-07 to 4-15-07 80 Christy Dale Kerr 5588 $860.58
9. 4-16-07 to 4-29-07 81 (paid for 80) Christy Dale Kerr 5603 $860.58
10. 4-30-07 to 5-13-07 81 (paid for 80) Christy Dale Kerr 5611 $860.58
11. 5-14-07 to 5-27-07 80.5 (paid for 80) Christy Dale Kerr 5619 $860.58
12. 5-28-07 to 6-10-07 81.5 (paid for 80) Christy Dale Kerr 5624 $860.58
13. 6-11-07 to 6-24-07 86.5 (paid for 80) Christy Dale Kerr 5636 $860.58
14. 6-25-07 to 7-8-07 85.5 (paid for 80) Christy Dale Kerr 5638 $860.58
15. 7-9-07 to 7-22-07 80 Christy Dale Kerr 5652 $860.58
16. 7-23-07 to 8-5-07 82.5 (paid for 80,) Christy Dale Kerr 5661 $860.58
17. 8-6-07 to 8-19-07 80.5 (paid for 80) Christy Dale Kerr 5672 $860.58
18. 8-20-07 to 9-2-07 80 (paid for 80) Christy Dale Kerr 5687 $860.58
19. 9-3-07 to 9-16-07 83 (paid for 80) Christy Dale Kerr 5700 $860.58
20. 9-17-07 to 9-30-07 80 Christy Dale Kerr 5706 $860.58
21. 10-1-07 to 10-14-07 81.5 (paid for 80) Christy Dale Kerr 5716 $860.58
22. 10-15-07 to 10-28-80 Christy Dale Kerr 5730 $860.58
07
23. 10-29-07 to 11-11-83.5 (paid for 80) Christy Dale Kerr 5734 $860.58
07
24. 11-12-07 to 11-25-84 (paid for 80) Christy Dale Kerr 5742 $860.58
07
25. 11-26-07 to 12-9-07 80 Christy Dale Kerr 5750 $860.58
26. 12-10-07 to 12-23-88 (paid for 80) Christy Dale Kerr 5755 $860.58
07
Total $22,375.08
a. Christy received net compensation of $22,375.08 for hours claimed to have
been worked as Secretary/Treasurer in 2007.
b. Christy’s total gross compensation for 2007, as approved by the Board, was
Christy, 09-008
Page 20
$29,120.00.
1. Christy's wage was set at $14.00 an hour in 2007 (see, Finding no.
22).
2. The maximum amount (gross) Christy could receive was $29,120.00
based on her hourly rate of (14.00/hour x 40 [hours per work week] x
52 [work weeks] = 29,120).
c. The 26 payroll checks outlined in the chart above were payroll checks for bi-
weekly payroll due in 2007 with the exception of check #5558 for the 1-22-07
to 2-4-07 pay period.
1. Christy compensated herself a half hour not worked for the pay period
of 1-22-07 to 2-4-07.
d. Christy was due 53.0 hours in comp time for work performed from 12-25-06
to 12-23-07.
1. Christy utilized comp time during the 2007 payroll year.
2. Amount of comp hours utilized during the 2007 payroll period is
unknown due to a comp log not being completed.
57. In addition to compensation approved by the Board, Christy issued herself
unauthorized paychecks in 2007 to compensate herself for hours she alleged to
have worked from 2004 through 2006 for which she claimed payment was not
previously made.
a. Hours allegedly worked and recorded for previous years were written on
monthly calendar sheets prepared and maintained by Christy.
1. Hours recorded for previous years were not documented on official
township time sheets.
b. Hours recorded by Christy were not approved by the Board or any individual
Township Supervisor.
1. The blank time sheets contain the signature of Supervisor Kerr.
2. Christy never provided Kerr with the calendars.
c. Additional paychecks issued by Christy were not approved by the Board or
any individual Township Supervisor.
58. Christy compensated herself for 3,220 hours she claimed to have worked in 2004
through 2006 at her 2007 pay rate ($14.00 an hour).
a. Gross payments totaled $45,080.00 (3,220 x $14.00/hr).
b. The Supervisors never approved Christy to receive any of these payments.
c. The Supervisors never approved Christy to receive a pay out of any comp
time.
d. Christy appended monthly calendar sheets for months in 2004, 2005 and
2006 to blank time sheets to justify the additional payments she issued to
Christy, 09-008
Page 21
her in 2007.
59. Listed below are the payments Christy authorized to herself in 2007 for hours she
claimed from 2004 through 2006.
Month Employee Approved by Calendar Months Total # Paid by Check
Indicated on Signature Signature of Attached to Time sheet of Township Amount
2007 Time Supervisor Hours Check #
sheet Claimed
January 07 Christy Dale Kerr July 04, Sept 04, Aug 04 240 5522 $860.58
5519 $860.58
5539 $860.58
February 07 Christy Dale Kerr Oct 04, Nov 04, Dec 04 280 5557 $860.58
5563 $1,236.94
5565 $860.58
March 07 Christy Dale Kerr Jan 05, Feb 05, March 05 280 5571 $860.58
5575 $1,236.94
5582 $860.58
June 07 Christy Dale Kerr April 05, May 05, June 05 360 5625 $1,236.94
5635 $1,236.94
5641 $1,236.94
July 07 Christy Dale Kerr July 05, Aug 05, Sept 05 440 5640 $1,236.94
5659 $1,236.94
5637 $1,236.94
5639 $860.58
5656 $1,236.94
August 2007 Christy Dale Kerr Oct 05, Nov 05, Dec 05 360 5660 $1,236.94
5671 $1,236.94
5673 $1,236.94
September 2007 Christy Dale Kerr Jan 06, Feb 06, March 06 400 5705 $1,236.94
5691 $1,236.94
5692 $1,236.94
5693 $1,236.94
October 2007 Christy Dale Kerr April 06, May 06, June 06 360 5710 $1,236.94
5715 $1,236.94
5728 $1,236.94
November 2007 Christy Dale Kerr July 06, Aug 06, Sept 06 200 5733 $1,236.94
5735 $860.58
December 2007 Christy Dale Kerr Oct 06, Nov 06 300 5754 $1,236.94
5759 $860.58
5764 $1,057.21
Total $35,638.75
a. Christy received net payments totaling $35,638.75 for hours she claimed to
have worked as Secretary/Treasurer during 2004 through 2006.
1. Christy calculated her retroactive payments based upon the number
of hours claimed multiplied by her 2007 pay rate ($14.00 an hour).
Christy, 09-008
Page 22
60. Christy deposited the unauthorized payments she received in 2007 into her
personal bank account at First National Bank as shown in the chart below:
Township Check Check Date Deposited
Check # Date Amount Signatures
5522 1-8-07 $860.58 Kerr, Christy 1-9-07
5519 1-2-07 $860.58 Kerr, Christy 1-2-07
5539 1-20-07 $860.58 Kerr, Christy 1-20-07
5557 2-2-07 $860.58 Kerr, Christy 2-2-07
5563 2-13-07 $1,236.94 Kerr, Christy 2-14-07
5565 2-21-07 $860.58 Kerr, Christy 2-21-07
5571 3-2-07 $860.58 Kerr, Christy 3-5-07
5575 3-13-07 $1,236.94 Kerr, Christy 3-14-07
5582 3-30-07 $860.58 Kerr, Christy 4-2-07
5625 6-12-07 $1,236.94 Kerr, Christy 6-12-07
5635 6-20-07 $1,236.94 Kerr, Christy 6-20-07
5641 6-28-07 $1,236.94 Kerr, Christy 6-28-07
5640 7-19-07 $1,236.94 Kerr, Christy 7-19-07
5659 7-31-07 $1,236.94 Kerr, Christy 8-2-07
5637 7-3-07 $1,236.94 Kerr, Christy 7-3-07
5639 7-12-07 $860.58 Kerr, Christy 7-12-07
5656 7-27-07 $1,236.94 Kerr, Christy 7-27-07
5660 8-6-07 $1,236.94 Kerr, Christy 8-6-07
5671 8-15-07 $1,236.94 Kerr, Christy 8-16-07
5673 8-22-07 $1,236.94 Kerr, Christy 8-22-07
5705 9-28-07 $1,236.94 Kerr, Christy 9-28-07
5691 9-7-07 $1,236.94 Kerr, Christy 9-10-07
5692 9-12-07 $1,236.94 Kerr, Christy 9-13-07
5693 9-20-07 $1,236.94 Kerr, Christy 9-20-07
5710 10-5-07 $1,236.94 Kerr, Christy 10-5-07
5715 10-23-07 $1,236.94 Kerr, Christy 10-23-07
5728 10-17-07 $1,236.94 Kerr, Christy 10-17-07
5733 11-5-07 $1,236.94 Kerr, Christy 11-5-07
5735 11-16-07 $860.58 Kerr, Christy 11-19-07
5754 12-13-07 $1,236.94 Kerr, Christy 12-13-07
5759 12-18-07 $860.58 Kerr, Christy 12-18-07
5764 12-27-07 $1,057.21 Kerr, Christy 12-28-07
Total $35,638.75
a. Christy prepared and signed all of the retroactive payments issued to her as
an authorized signatory for the Township.
b. The checks also bear the signature of Supervisor Kerr.
1. Kerr has no recollection if the checks were blank at the time.
61. W-2 Wage and Tax Statements issued to Christy for 2007 by the Township
confirmed total compensation of $93,800.00.
a. Christy’s approved compensation for 2007 was $29,120.00.
Christy, 09-008
Page 23
b. Christy received $64,680.00 in unauthorized compensation in 2006 [sic].
62. Christy received a net [sic] private pecuniary gain of $64,680.00 ($35,638.75 net) in
2007 when she issued herself unauthorized retroactive payments for 2004 through
2006 as the Secretary/Treasurer that were not authorized by the Board of
Supervisors.
63. In 2008, Christy recorded and submitted (22) time sheets and/or time cards and
received payment in her capacity as Secretary/Treasurer as shown below:
Pay Period Hours Employee Approved Paid by Check
Indicated on Signature by Signature Township Amount
Time on Time of Check #
sheets/Time sheet Supervisor
Cards
12-24-07 to 1-6-08 Paid for 80 Christy No Signature 5769 $871.30
1-7-08 to 1-20-08 Paid for 80 Christy Dale Kerr 5772 $886.20
1-21-08 to 2-3-08 Paid for 80 Christy Dale Kerr 5784 $886.20
2-4-08 to 2-17-08 Paid for 80 Christy Dale Kerr 5799 $880.85
2-18-08 to 3-2-08 Paid for 80 Christy Dale Kerr 5807 $886.20
3-3-08 to 3-16-08 Paid for 75.4 N/A (time Dale Kerr 5819 $846.60
cards)
3-17-08 to 3-30-08 Paid for 80.3 N/A (time Dale Kerr 5822 $893.16
cards)
3-31-08 to 4-13-08 Paid for 78.90 N/A (time Dale Kerr 5843 $874.43
cards)
4-14-08 to 4-27-08 Paid for 79.9 N/A (time Dale Kerr 5847 $885.14
cards)
4-29-08 to 5-11-08 Paid for 77.9 N/A (time Dale Kerr 5858 $863.72
cards)
5-12-08 to 5-25-08 Paid for 79.1 N/A (time Dale Kerr 5863 $876.57
cards)
5-27-08 to 6-8-08 Paid for 76.5 N/A (time Dale Kerr 5874 $848.74
cards)
6-9-08 to 6-22-08 Paid for 79.3 N/A (time Dale Kerr 5880 $878.70
cards)
6-23-08 to 7-6-08 Paid for 80.6 N/A (time Dale Kerr 5885 $894.76
cards)
7-7-08 to 7-20-08 Paid for 82.9 N/A (time Dale Kerr 5898 $932.76
cards)
7-21-08 to 8-3-08 Paid for 78.95 N/A (time Dale Kerr 5906 $874.97
cards)
8-4-08 to 8-17-08 Paid for 72.7 N/A (time Dale Kerr 5915 $814.50
cards)
8-18-08 to 8-31-08 Paid for 79.6 N/A (time Dale Kerr 5925 $881.92
cards)
9-1-08 to 9-14-08 Paid for 76 N/A (time Dale Kerr 5933 $843.39
cards)
9-15-08 to 9-28-08 Paid for 81.4 N/A (time Dale Kerr 5940 $908.67
cards)
9-29-08 to 10-12-Paid for 80.7 N/A (time Dale Kerr 5951 $897.44
08 cards)
10-13-08 to 10-26-Paid for 79.2 N/A (time Dale Kerr 5961 $878.70
08 cards)
Total $19,304.92
Christy, 09-008
Page 24
a. The time sheets cover the period from January 2008 until her resignation in
October 2008.
b. Christy received $19,304.92 (net pay) for hours claimed to have been
worked as Secretary/Treasurer in 2008.
1. Christy's wage was set at $14.42 an hour in 2008 (see, Finding no.
[22]).
c. W-2 Wage and Tax Statements issued to Christy for 2008 confirm total
compensation of $25,121.20.
64. Beginning in 2008, all paychecks issued to Christy were individually approved by
the Board of Supervisors.
a. In 2008, individual payroll checks were documented on bill lists and required
Board approval.
b. Beginning in 2008, Christy was also required to punch a time clock.
c. As a result of these changes made by the Board, Christy was limited in the
number of paychecks she was able to issue to herself.
65. In 2008, Christy issued herself unauthorized payments which concealed that she
was the payee or she would not list payments made to herself on bill lists submitted
to the Board for approval.
66. From April 2008 to October 2008, Christy issued (15) checks to herself which either
concealed from the Board of Supervisors that she was the actual payee or were not
listed on bill lists approved by the Board.
a. Christy would not list some of the checks on bill lists submitted to the Board
of Supervisors for approval.
b. Christy would not list the actual payee on other bill lists, concealing that the
checks were actually made payable to her.
67. Listed below are the (15) checks Christy issued to herself which were either not on
any bill lists or listed an altered payee and do no represent payment for any hours
worked:
Check Check Check Payee per Bill List Actual
# Date Amount Signed By Payee
Not on bill lists, April list covered Christy
time frame of 3-31-08 to 4-14-08,
Christy, Dale May list covered time frame of 5-
5852 4-28-08 $932.99 Kerr 6-08 to 5-15-08
Not on bill lists, April list covered Christy
time frame of 3-31-08 to 4-14-08,
Christy, Dale May list covered time frame of 5-
5847 4-28-08 $885.14 Kerr 6-08 to 5-15-08
Operating Engs. Local 66 Contrib Christy
Acct. (check amount was listed
Christy, Dale as $51.40, check date was listed
5884 6-26-08 $932.99 Kerr as 6-23-08)
Christy, Dale Keystone Municipal Collections Christy
5879 6-9-08 $932.99 Kerr (check amount was listed as
Christy, 09-008
Page 25
$187.00, check date was listed
as 6-23-08)
Not on bill lists, June list covered Christy
time frame of 6-23-08 to 7-7-08,
Christy, Dale July list covered time frame of
5894 7-15-08 $1,040.11 Kerr only 7-21-08
Not on bill lists, July list covered Christy
time from of only 7-21-08, August
Christy, Dale list covered time frame of 7-31-08
5904 7-25-08 $932.99 Kerr to 8-8-08
Operating Engs. Local 66 Contrib Christy
Acct (check amount was listed as
Christy, Dale $25.70, check date was listed as
5905 7-31-08 $932.99 Kerr 7-31-08)
PA Department of Revenue Christy
(check amount was listed as
Christy, Dale $389.12, check date was listed
5914 8-5-08 $932.99 Kerr as 8-18-08)
Void (check amount was listed as Christy
Christy, Dale $0.00, check date was listed as
5920 8-18-08 $932.99 Kerr 8-18-08)
Not on bill lists, August list Christy
covered time frame of 7-31-08 to
Christy, Dale 8-8-08, Sept list covered time
5924 8-27-08 $932.99 Kerr frame of 8-29-08 to 9-8-08*
Not on bill lists, August list Christy
covered time frame of 7-31-08 to
Christy, Dale 8-8-08, Sept list covered time
5923 8-22-08 $932.99 Kerr frame of 8-29-08 to 9-8-08*
Not on bill lists, Sept list covered Christy
time frame of 8-29-08 to 9-8-08*,
Christy, Dale subsequent Sept list covered
5932 9-11-08 $932.99 Kerr time frame of only 9-15-08*
Christy listed five checks to First Christy
National Bank all having the
Christy, Dale same check number (5939) and
5939 9-26-08 $932.99 Kerr the same date (9-26-08).
PA Department of Revenue Christy
(check amount was listed as
Christy, Dale $531.83, check date was listed
5938 9-19-08 $932.99 Kerr as 9-29-08)
PA Department of Revenue Christy
(check amount was listed as
10-14-Christy, Dale $363.09, check date was listed
5948 08 $1,361.45 Kerr as 10-13-08)
TOTAL $14,482.58
* Noteworthy is that there were two bill lists for the month of September; the first list spanned
the time frame of 8- 29-08 to 9-8-08, and the second list was only for 9-15-08.
a. The above referenced checks were issued without any support
documentation on file at the Township building to justify payments.
b. Christy either omitted the checks from the bill lists and/or altered bill lists to
conceal the unauthorized payments to her.
68. Seven of the payments Christy authorized to herself were listed on bill lists as
Christy, 09-008
Page 26
another payee and often had the check amounts altered as listed below:
Check Payee Bill Lists Check Actual Payee Actual
No. Amount Amount
on Bill
Lists
5879 Keystone Municipal Collections $187.00 Dixie Christy $932.99
5884 Operating Engineers Local 66 $51.40 Dixie Christy $932.99
5905 Operating Engineers Local 66 $25.70 Dixie Christy $932.99
5914 PA Dept. of Revenue $389.12 Dixie Christy $932.99
5938 First National Bank [sic] $531.83 Dixie Christy $932.99
5939 PA Dept of Revenue [sic] $932.99 Dixie Christy $939.99
5948 PA Dept of Revenue $363.09 Dixie Christy $1,361.45
69. Christy deposited all of the 15 unauthorized payments she received in 2008 into her
personal bank account at First National Bank as shown in the chart below:
Township Check Check Date Deposited
Check # Date Amount Signatures
5852 4-28-08 $932.99 Kerr, Christy 4-29-08
5847 4-28-08 $885.14 Kerr, Christy 4-28-08
5884 6-26-08 $932.99 Kerr, Christy 6-26-08
5879 6-9-08 $932.99 Kerr, Christy 6-19-08
5894 7-15-08 $1,040.11 Kerr, Christy 7-17-08
5904 7-25-08 $932.99 Kerr, Christy 7-25-08
5905 7-31-08 $932.99 Kerr, Christy 7-31-08
5914 8-5-08 $932.99 Kerr, Christy 8-8-08
5920 8-18-08 $932.99 Kerr, Christy 8-19-08
5924 8-27-08 $932.99 Kerr, Christy 8-29-08
5923 8-22-08 $932.99 Kerr, Christy 8-25-08
5932 9-11-08 $932.99 Kerr, Christy 9-11-08
5939 9-26-08 $932.99 Kerr, Christy 9-26-08
5938 9-19-08 $932.99 Kerr, Christy 9-19-08
5948 10-14-08 $1,361.45 Kerr, Christy 10-16-08
Total $14,482.58
70. W-2 Wage and Tax Statements issued to Christy for 2008 compensation confirm
total gross compensation of $43,723.00.
a. Christy was issued two W-2 Wage and Tax statements listing compensation:
$25,121.20
$18,601.80
$43,723.00
b. Christy’s approved gross compensation for 2008 is based on the following:
Hourly rate of $14.42 x 40 hrs/week x 44 weeks (22 pay periods) totals
$25,379.20.
c. Christy received compensation in 2008 not approved by the Board of
Supervisors totaling $18,343.80
W-2: $43,723.00
Approved: $25,379.20
Christy, 09-008
Page 27
$18,343.80
71. Christy realized a private pecuniary gain of $18,343.80 ($14,482.58 net) in 2008
when she issued herself payments which she was not entitled to receive, and
subsequently concealed said payments by altering the payee and the amounts or
by not listing the payments on bill lists to be approved by the Board of Supervisors.
a. Christy signed all of the 2008 payments she issued to herself as an
authorized signatory for the Township.
b. Christy deposited all of the fifteen unauthorized checks into her personal
First National Bank account.
72. During Christy's tenure as Secretary/Treasurer, Christy was permitted to be
reimbursed for expenses she incurred on behalf of the Township.
a. Expenses for which Christy received reimbursement included mileage,
telephone usage, postage, etc.
73. Christy supplied the Township with invoices, receipts, notes, etc. to document
expenses she incurred.
a. Documentation supplied by Christy to justify a reimbursement was to be
reviewed by the Supervisors, specifically Kerr.
74. A reimbursement check was not permitted to be issued unless support
documentation was submitted and reviewed by a Supervisor.
a. The Supervisors reviewed the support documentation to determine if the
expense(s) were permissible for reimbursement.
b. Reimbursement checks were to be signed by at least one Supervisor and
Christy after it was determined that the expense(s) were permissible for
reimbursement.
1. Reimbursement checks were issued from the Township's general
fund account.
75. During the time period covering 2004 through 2008, Christy issued herself the
following forty-two reimbursement checks:
Check Check
Date Check # Amount Signed by
12/20/2003 6197 $138.05 James White, Ralph Currie, Dixie Christy
12/20/2003 6198 $129.05 James White, Ralph Currie, Dixie Christy
12/30/2003 6264 $115.89 James White, Undistinguishable, Dixie Christy
1/21/2004 6284 $155.44 Undistinguishable, Dale Kerr, Dixie Christy
2/2/2004 6302 $139.43 James White, Dixie Christy
3/2/2004 6304 $129.37 James White, Dixie Christy
4/1/2004 6339 $130.10 Dale Kerr, Dixie Christy
9/2/2004 6547 $250.72 Dale Kerr, Dixie Christy
10/7/2004 6581 $306.48 Dale Kerr, Dixie Christy
10/27/2004 6615 $58.05 Dale Kerr, Dixie Christy
12/21/2004 6669 $100.00 Dale Kerr, Dixie Christy
Christy, 09-008
Page 28
12/23/2004 6698 $164.06 Dale Kerr, Dixie Christy
1/13/2005 6707 $34.55 Dale Kerr, Dixie Christy
1/26/2005 6708 $159.03 Dale Kerr, Dixie Christy
2/8/2005 6714 $130.27 Dale Kerr, Dixie Christy
3/7/2005 6771 $87.04 Dale Kerr
3/14/2005 6796 $159.99 Dale Kerr, Dixie Christy
5/4/2005 6847 $127.90 Dale Kerr, Dixie Christy
5/12/2005 6848 $127.77 Dale Kerr, Dixie Christy
6/28/2005 6810 $253.28 Dale Kerr, Dixie Christy
7/8/2005 6812 $189.13 Dale Kerr, Dixie Christy
7/28/2005 6814 $159.02 Dale Kerr, Dixie Christy
8/10/2005 6952 $101.60 Dale Kerr, Dixie Christy
8/18/2005 6989 $233.95 Dale Kerr, Dixie Christy
10/4/2005 7026 $188.54 Dale Kerr, Dixie Christy
12/13/2005 7074 $91.88 Dale Kerr, Dixie Christy
6/29/2006 7388 $204.99 Dale Kerr, Dixie Christy
8/14/2006 7430 $322.72 Dale Kerr, Dixie Christy
10/23/2006 7501 $346.44 Dale Kerr, Dixie Christy
1/2/2007 7621 $300.45 Dale Kerr, Dixie Christy
1/22/2007 7691 $114.70 Christy, Undistinguishable, Undistinguishable
2/2/2007 7624 $94.46 Dale Kerr, Dixie Christy
3/12/2007 7766 $125.38 Dale Kerr, Undistinguishable, Undistinguishable
3/21/2007 7745 $77.09 Dale Kerr, Dixie Christy
4/9/2007 7746 $467.40 Dale Kerr, Dixie Christy
5/7/2007 7810 $28.80 Dale Kerr, Undistinguishable, Dixie Christy
2/8/2008 8205 $20.40 Dale Kerr, Dixie Christy
4/7/2008 8273 $75.50 Dale Kerr, Dixie Christy
4/29/2008 8319 $34.35 Dale Kerr, Dixie Christy
6/6/2008 8346 $107.71 Dale Kerr, Dixie Christy
7/11/2008 8421 $151.10 Dale Kerr, Dixie Christy
7/24/2008 8426 $154.00 Dale Kerr, Dixie Christy
Total $6,486.08
a. Of the forty-two reimbursement checks issued to Christy, fifteen did not have
support documentation on file at the Township building to justify
reimbursement payments to Christy.
1. The fifteen reimbursement checks (indicated by the shaded areas in
the above chart) total $2,462.36.
2. Christy issued herself checks for alleged reimbursements without the
knowledge of the Township Supervisors due to Supervisor Dale Kerr
regularly signing blank checks at Christy's request.
76. The checks Christy issued to herself for reimbursements with no documentation
were deposited into her personal bank account at First National Bank as shown
below:
Check Check Date
Date Check # Amount Signed by Deposited
10/27/2004 6615 $58.05 Dale Kerr, Dixie Christy 10-29-04
Christy, 09-008
Page 29
2/8/2005 6714 $130.27 Dale Kerr, Dixie Christy 2-8-05
3/7/2005 6771 $87.04 Dale Kerr 3-7-05
3/14/2005 6796 $159.99 Dale Kerr, Dixie Christy 3-14-05
5/4/2005 6847 $127.90 Dale Kerr, Dixie Christy 5-4-05
6/28/2005 6810 $253.28 Dale Kerr, Dixie Christy 6-28-05
7/8/2005 6812 $189.13 Dale Kerr, Dixie Christy 7-13-05
7/28/2005 6814 $159.02 Dale Kerr, Dixie Christy 7-29-05
8/10/2005 6952 $101.60 Dale Kerr, Dixie Christy 8-10-05
8/18/2005 6989 $233.95 Dale Kerr, Dixie Christy 8-18-05
10/4/2005 7026 $188.54 Dale Kerr, Dixie Christy 10-5-05
12/13/2005 7074 $91.88 Dale Kerr, Dixie Christy 12-14-05
6/29/2006 7388 $204.99 Dale Kerr, Dixie Christy 6-29-06
8/14/2006 7430 $322.72 Dale Kerr, Dixie Christy 8-25-06
7/24/2008 8426 $154.00 Dale Kerr, Dixie Christy 7-24-08
Total $2,462.36
a. Christy signed fourteen of the fifteen reimbursement checks issued to her as
an authorized signatory for the Township.
77. Since approximately 2002, the firm of Caruso & Caruso has audited the finances of
Muddy Creek Township.
a. The audits normally began in February or March of each year.
b. The audits conclude on or about November of each year.
c. At the conclusion of the audits, exit interviews were conducted with Christy
by the auditors informing her of the results of the audits.
78. Caruso and Caruso provided audit reports and letters to the Township each year
containing comments as well as suggestions to the Board of Supervisors to improve
internal control structures and operating efficiencies of the Township.
a. The auditors annually questioned one person (Christy) holding both the
positions of Secretary and Treasurer and recommended that the duties be
better segregated to develop internal control procedures to reduce risks of
errors or irregularities.
b. The auditors also suggested the Township implement a fraud policy which
identifies employee responsibilities to report even suspected fraud.
79. Caruso & Caruso letters dated November 15, 2005, August 9, 2006, and August 29,
2007, were forwarded to the Township at the conclusion of the 2004, 2005, and
2006 audits and include the following suggestions to improve internal control and
operating efficiencies of the Township.
a. “The Township is subject to control risk associated with the recordkeeping
and treasury functions. This condition creates the risk that errors or
irregularities with either the recordkeeping or treasury functions could occur
and not be detected. The Secretary/Treasurer is responsible for all billing,
credit memos, receiving, depositing, journalizing, posting and reconciliation
of all ledgers and bank accounts of all funds. Though there are two
employees of the Administrative Department, we recommend that the duties
mentioned above be better segregated to develop internal control
Christy, 09-008
Page 30
procedures to strengthen this weakness.”
b. “In a continuing effort to improve audit quality and meet public expectations,
the professional standards for audits have been changed with the new
auditing standard, “Consideration of Fraud in a Financial Statement Audit.”
Auditors are now required to perform new, substantial audit procedures
aimed at detecting material misstatements caused by fraud. However,
auditor’s responsibility for detecting fraud has not changed as a result of the
new standard. The auditor continues to have a responsibility to provide
reasonable, not absolute, assurance that the financial statements are free
from material misstatement. The responsibility for preventing, detecting, and
deterring fraud continues to rest with management and those with oversight
responsibilities. Currently, Muddy Creek Township does not have a fraud
policy. To communicate its position on fraud, we recommend that Muddy
Creek Township issue a fraud policy statement which identities employee’s
responsibility to report even suspected fraud or incorporating the
requirement into a formal code of conduct. Additionally, management should
evaluate whether appropriate internal controls have been implemented in
areas management has identified as posing a higher risk of fraudulent
activity, as well as controls over the entity’s financial reporting process.”
c. A letter was drafted but not finalized or sent to the Supervisors regarding the
audit for the 2007 calendar year.
80. Christy did not provide the Caruso & Caruso letters and/or reports to the
Supervisors for review during the time period of 2004 through 2007.
a. During the 2004 - 2007 time period, Christy was issuing herself payments
which she was not entitled to receive by exploiting the lack of internal
controls of the Township as cited in the auditor letters and
recommendations.
81. Christy issued responses annually between 2005 and 2008 to the audit reports
without seeking input from the Board of Supervisors.
a. Christy issued letters dated November 15, 2005, August 9, 2006, and August
29, 2007, which stated the following:
“We believe the effects of the uncorrected financial statement misstatements
summarized in the attached schedule are immaterial, both individually and in
the aggregate, to the financial statements taken as a whole.”
“We acknowledge our responsibility for the design and implementation of
programs and controls to prevent and detect fraud.”
“We have no knowledge of any fraud or suspected fraud affecting the entity
involving:
1. Management;
2. Employees who have significant roles in internal control; or
3. Others where the fraud could have a material effect on the financial
statements.”
“We have no knowledge of any allegations of fraud or suspected fraud
affecting the entity received in communications from employees, former
Christy, 09-008
Page 31
employees, analysts, regulators, or others.”
“There are no-
Violations or possible violations of budget ordinances, laws and
regulations (including those pertaining to adopting, approving and
amending budgets,), provisions of contracts and (grant) agreements,
tax or debt limits, and any related debt covenants whose effects
should be considered for disclosure in the financial statements or as
a basis for recording a loss contingency.
Reservations or designation of fund equity that were not properly
authorized and approved.”
b. The letters contain the signatures of Christy and Supervisor Kerr.
1. Kerr has no recollection of the audit reports or signing letters to the
auditors.
82. At the times Christy was issuing letters to Caruso & Caruso proclaiming “…no
knowledge of allegations of fraud or suspected fraud…” she was issuing herself
checks which were not related to her duties and which were not approved by the
Board of Supervisors.
83. During the audit of the Township's 2007 finances, auditor Vivian Caruso determined
that Christy overcompensated herself.
a. On October 23, 2008, Vivian Caruso confronted Christy about the
overcompensation.
1. Christy stated to Caruso that she received extra compensation for a
"special project" of Christy matching up old building permits to
corresponding files coded by maps and parcel numbers.
2. Christy provided Caruso with time sheets and calendar sheets which
purported to document hours spent on the "special project."
84. Caruso asked to see documentation approving Christy to be compensated for work
on the "special project."
a. Caruso was aware that the "special project" was not budgeted for or
approved by the Supervisors.
b. Christy did not provide Caruso with minutes, resolutions, etc. that indicated
that the Supervisors approved Christy to be compensated for work done on
the special project.
c. Christy claimed that she had been working on the "special project" since
2006.
85. Caruso contacted Supervisor Dale Kerr via telephone on or about October 24,
2008, to advise Kerr of the additional compensation paid to Christy.
a. Kerr consulted with Supervisor Dale Saunders and Solicitor Tom Smith
about the situation.
b. It was determined that Kerr and Saunders would meet with Christy to discuss
Christy, 09-008
Page 32
the situation.
86. On October 27, 2008, Kerr and Saunders met Christy at the Township building to
discuss the unapproved compensation she had been issuing to herself.
a. When asked about the unauthorized compensation, Christy informed Kerr
and Saunders that she was on medication and shouldn't be at work.
b. Christy did not provide any explanations to Kerr and Saunders as to why she
had issued herself compensation without approval or documentation as to
hours worked.
c. Christy resigned effective immediately upon questioning by the Supervisors.
87. On June 30, 2009, the Pennsylvania State Police filed charges of Forgery, Theft by
Unlawful Taking, Theft by Deception, Receiving Stolen Property and Access Device
Fraud against Christy in relation to her execution of 103 unauthorized payroll
checks issued to her between March 2005 and October 2008.
a. Charges are pending in the Butler County Court of Common Pleas.
88. Christy realized a financial gain of $137,419.66 ($95,755.34 net)by utilizing her
position as Secretary/Treasurer to issue herself extra payroll/reimbursement checks
without the approval of the Supervisors and when she falsified Township
documents to conceal unjustifiable payments to herself during the time period of
2004 through 2008 as shown below:
Year(s) Gross Amount Net Amount
2005 Payroll $9,340.00 $8,296.13
2006 Payroll $42,593.50 $34,875.52
2007 Payroll $64,680.00 $35,638.75
2008 Payroll $18,343.80 $14,482.58
2004 through 2008 Reimbursements $2,462.36 $2,462.36
Total $137,419.66 $95,755.34
III.DISCUSSION:
As Secretary/Treasurer for Muddy Creek Township (“Township”), Butler County,
from January 2002 to October 27, 2008, Respondent Dixie Christy, hereinafter also
referred to as “Respondent,” “Respondent Christy,” and “Christy,” was a public
official/public employee subject to the provisions of the Public Official and Employee Ethics
Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq.
The allegation is that Respondent Christy violated Section 1103(a) of the Ethics Act
when she used the authority of her public position for private pecuniary benefit by
authorizing payments to her which were neither approved nor authorized by the Township
Board of Supervisors (“Board”).
Pursuant to Section 1103(a) of the Ethics Act, a public official/public employee is
prohibited from engaging in conduct that constitutes a conflict of interest:
§ 1103. Restricted activities
(a)Conflict of interest.—
No public official or public
Christy, 09-008
Page 33
employee shall engage in conduct that constitutes a conflict of
interest.
65 Pa.C.S. § 1103(a).
The term "conflict of interest" is defined in the Ethics Act as follows:
§ 1102. Definitions
"Conflict" or "conflict of interest."
Use by a public
official or public employee of the authority of his office or
employment or any confidential information received through
his holding public office or employment for the private
pecuniary benefit of himself, a member of his immediate family
or a business with which he or a member of his immediate
family is associated. The term does not include an action
having a de minimis economic impact or which affects to the
same degree a class consisting of the general public or a
subclass consisting of an industry, occupation or other group
which includes the public official or public employee, a
member of his immediate family or a business with which he or
a member of his immediate family is associated.
65 Pa.C.S. § 1102.
Section 1103(a) of the Ethics Act prohibits a public official/public employee from
using the authority of public office/employment or confidential information received by
holding such a public position for the private pecuniary benefit of the public official/public
employee himself, any member of his immediate family, or a business with which he or a
member of his immediate family is associated.
We shall now summarize the material facts pertaining to this case. Given
Respondent’s failure to file an Answer to the Investigative Complaint, the facts as averred
by the Investigative Complaint are deemed admitted by Respondent. 65 Pa.C.S. §
1108(e); 51 Pa. Code § 21.5(k)(1).
Christy served as Township Secretary/Treasurer from January 2002 to October 27,
2008. As Township Secretary/Treasurer, Christy’s responsibilities included retaining and
preserving Township documents and records, having custody and maintenance of all
Township financial records, having signature authority over all Township accounts, making
deposits and withdrawals as to Township accounts, preparing Township checks for
issuance, and preparing bills for Board approval.
The Board approved the payment of payroll and other bills/expenditures by
approving bill lists at its regular monthly meetings. Prior to 2008, the bill lists indicated a
total payroll amount but did not delineate payroll by individual.
The Township Supervisors approved payroll and other expenditures based on
financial information provided by Christy. Christy had sole control of Township finances
(bank statements, cancelled checks, check registers, checkbooks, audit reports, and the
like). The Supervisors trusted Christy and did not challenge Christy's actions or
explanations regarding finances.
Township checks issued to pay bills are signed by the Secretary/Treasurer and two
Supervisors. Township payroll checks are signed by the Secretary/Treasurer and one
Supervisor. Facsimile stamps are not utilized.
Christy, 09-008
Page 34
During the relevant time period from 2004 through 2008, the Board set Christy’s
compensation as Secretary/Treasurer as detailed at Fact Finding 22 a. The Board set
Christy’s compensation as Secretary/Treasurer based on a 40 hour work week. The Board
did not approve compensation for Christy for any hours worked over 40 hours in a work
week. The Board authorized a "comp time" arrangement permitting Christy to take time off
(that was accrued) in lieu of receiving overtime pay.
From at least 2002 to approximately March 2008, Christy was required to complete
time sheets to document work completed. Time sheets required the approval of one
Supervisor. In approximately March 2008, the Supervisors required that Christy begin
utilizing a time clock and time card instead of time sheets to record hours worked.
Members of the Board were concerned that Christy was not working a full 40 hour work
week, but was being compensated for at least 40 hours per week.
Supervisor Dale Kerr (“Kerr”) was the Supervisor primarily responsible for oversight
of Township employees, including Christy. Christy routinely submitted blank time sheets to
Kerr for approval. Christy advised Kerr that she did not have time to fill out time sheets
and that she would complete the time sheets at a later time. Kerr always signed the blank
time sheets submitted to him by Christy. Christy's time sheets were not reviewed by the
full Board prior to payments being issued to Christy.
Additionally, the Supervisors, particularly Kerr, would sign blank checks upon
Christy's request. Kerr regularly signed blank payroll and general fund checks at Christy’s
request.
During the relevant time period from 2004 to late 2008, Township payroll was issued
bi-weekly. A maximum of twenty-six payroll checks were due to be issued each year for
Township employees.
Between January 2005 and October 2008, Christy regularly issued payments to
herself without Board approval, which payments were unrelated to any of Christy’s
Township duties and responsibilities. Christy was not eligible to receive any payments
other than her approved bi-weekly compensation. Christy submitted blank time sheets to
Kerr for approval and issued payments to herself based on bogus time sheets. Christy
issued checks to herself without Board approval by submitting blank checks to Kerr to sign.
Christy would then make checks payable to her and sign the checks as the second
authorized signatory.
In 2005, based upon Christy’s hourly rate, the maximum gross amount that Christy
was to receive was $27,040.00. W-2 Wage and Tax Statements for 2005 issued by the
Township confirm total compensation paid to Christy as $36,380.00. Christy issued 35
payroll checks to herself as Township Secretary/Treasurer, even though there were only
26 pay periods. As detailed in Fact Finding 45 a, nine such payroll checks, totaling
$8,296.13 (net), were unauthorized additional paychecks to Christy. Christy prepared all
of the checks issued to her and signed the checks as an authorized Township signatory.
None of the checks issued to Christy were individually approved by the Board. Payroll was
approved by the Board as a lump sum.
Per Fact Findings 45-47 and 88, deemed admitted by Christy, Christy realized a
financial gain of $9,340.00 gross ($8,296.13 net) in 2005 when she issued and signed nine
unauthorized payroll checks to herself.
In 2006, based upon Christy’s hourly rate, the maximum gross amount that Christy
was to receive was $29,120.00. W-2 Wage and Tax Statements for 2006 issued by the
Township confirm total compensation paid to Christy as $71,713.50. Christy issued 64
payroll checks to herself as Township Secretary/Treasurer, even though there were only
26 pay periods. As detailed in Fact Finding 52, 38 such payroll checks totaling $34,875.52
Christy, 09-008
Page 35
(net) were unauthorized additional paychecks to Christy. Christy prepared all of the
unauthorized checks issued to her and signed the checks as an authorized Township
signatory. None of the checks issued to Christy were individually approved by the Board.
Payroll was approved by the Board as a lump sum.
Per Fact Findings 52-54 and 88, deemed admitted by Christy, Christy realized a
financial gain of $42,593.50 gross ($34,875.52 net) in 2006 when she issued and signed
38 unauthorized payroll checks to herself.
In 2007, based upon Christy’s hourly rate, the maximum gross amount that Christy
was to receive was $29,120.00. W-2 Wage and Tax Statements issued to Christy for 2007
by the Township confirm total compensation to Christy of $93,800.00. Christy received
$64,680.00 in unauthorized compensation in 2007. This unauthorized compensation
included unauthorized paychecks that Christy issued to herself--using her 2007 pay rate--
for 3,220 hours she claimed to have worked from 2004 through 2006 without having
previously been paid. The Supervisors never approved Christy to receive any of these
payments. Christy prepared all of these checks issued to her and signed the checks as an
authorized Township signatory. Per Fact Findings 62 and 88, deemed admitted by Christy,
Christy realized a financial gain of $64,680.00 gross ($35,638.75 net) in 2007 when she
issued and signed unauthorized retroactive payments to herself for 2004 through 2006.
Beginning in 2008, Christy was required to punch a time clock, and all paychecks
issued to Christy were individually approved by the Board. As a result of these changes
made by the Board, Christy was limited in the number of paychecks she was able to issue
to herself. However, per Fact Findings 67, 71 and 88, deemed admitted by Christy, Christy
realized a private pecuniary gain of $18,343.80 gross ($14,482.58 net) in 2008 when she
issued 15 unauthorized payments to herself, and subsequently concealed said payments
by listing different payees and amounts on the bill lists, or by not listing the payments on
the bill lists to be approved by the Board. Christy signed all of the 2008 payments she
issued to herself as an authorized Township signatory.
During Christy's tenure as Secretary/Treasurer, Christy was permitted to be
reimbursed for expenses she incurred on behalf of the Township. However, a
reimbursement check was not permitted to be issued unless support documentation was
submitted and reviewed by a Supervisor, and the Supervisor determined that the
expense(s) were permissible for reimbursement. Reimbursement checks were to be
signed by at least one Supervisor and Christy.
From October 2004 through July 2008, Christy issued to herself 15 reimbursement
checks totaling $2,462.36 for which there was no support documentation on file at the
Township building. Christy signed 14 of the aforesaid 15 reimbursement checks issued to
her as an authorized Township signatory. Christy issued herself checks for alleged
reimbursements without the knowledge of the Township Supervisors due to Kerr regularly
signing blank checks at Christy's request. Per Fact Findings 75-76 and 88, deemed
admitted by Christy, Christy realized an unauthorized financial gain of $2,462.36 when she
issued to herself 15 reimbursement checks totaling $2,462.36 for which there was no
support documentation on file at the Township building.
Since approximately 2002, the firm of Caruso & Caruso has conducted annual
audits of the finances of the Township. Each year, Caruso and Caruso provided audit
reports and letters to the Township containing comments as well as suggestions to the
Board to improve internal control structures and operating efficiencies of the Township.
The auditors annually questioned one person (Christy) holding both the positions of
Secretary and Treasurer and recommended that the duties be better segregated to
develop internal control procedures to reduce risks of errors or irregularities. The auditors
also suggested the Township implement a fraud policy. Christy did not provide the Caruso
& Caruso letters and/or reports to the Supervisors during the time period of 2004 through
Christy, 09-008
Page 36
2007. Christy issued annual responses to the audit reports, proclaiming “…no knowledge
of any allegations of fraud or suspected fraud….” Fact Finding 81 a.
In 2008, during the audit of the Township's 2007 finances, auditor Vivian Caruso
determined that Christy overcompensated herself. On October 27, 2008, Christy resigned
effective immediately upon questioning by the Supervisors.
On June 30, 2009, the Pennsylvania State Police filed criminal charges against
Christy in relation to her execution of unauthorized payroll checks issued to her between
March 2005 and October 2008.
Per Fact Finding 88, deemed admitted by Christy, Christy realized a financial gain
of $137,419.66 gross ($95,755.34 net)by utilizing her position as Township
Secretary/Treasurer to issue to herself extra payroll/reimbursement checks without the
approval of the Supervisors and by falsifying Township documents to conceal unjustifiable
payments to herself during the time period of 2004 through 2008.
We must now determine, based upon the record, whether the actions of
Respondent violated the Ethics Act. As we apply the facts to the allegations, due process
requires that we not depart from the allegations. Pennsy v. Department of State, 594 A.2d
845 (Pa. Commw. Ct. 1991). A violation of the Ethics Act must be based upon clear and
convincing proof. 65 Pa.C.S. § 1108(g). Clear and convincing proof is “so ‘clear, direct,
weighty, and convincing as to enable the trier of fact to come to a clear conviction, without
hesitance, of the truth of the precise facts in issue.’” In Re: Charles E.D.M., 550 Pa. 595,
601, 708 A.2d 88, 91 (1998) (Citation omitted).
Based upon the record before us, Respondent Christy clearly violated Section
1103(a) of the Ethics Act when she used the authority of her public position for private
pecuniary benefit by authorizing payments to her which were neither approved nor
authorized by the Board.
Christy used the authority of her public position as Township Secretary/Treasurer
when she submitted blank time sheets to Kerr for approval and issued payments to herself
based on bogus time sheets. Christy used the authority of her aforesaid public position
when she prepared and issued unauthorized Township checks to herself and signed the
checks as an authorized Township signatory. Christy further used the authority of her
aforesaid public position by actively concealing from the Board unauthorized payments
that she issued to herself, withholding from the Board audit reports/letters raising concerns
as to the potential for fraud, and issuing responses to such audit reports/letters. The
resulting private pecuniary benefit consisted of the unauthorized payments that Christy
received.
In 2005, Christy issued to herself nine extra, unauthorized payroll checks totaling
$8,296.13 net. Christy signed the checks as an authorized Township signatory.
In 2006, Christy issued to herself 38 extra, unauthorized payroll checks totaling
$34,875.52 net. Christy signed the checks as an authorized Township signatory.
In 2007, Christy realized a financial gain of $64,680.00 gross ($35,638.75 net) when
she issued and signed unauthorized retroactive payments to herself for 2004 through
2006.
In 2008, Christy realized a private pecuniary gain of $18,343.80 gross ($14,482.58
net) when she issued 15 unauthorized payments to herself, and subsequently concealed
said payments by listing different payees and amounts on the bill lists, or by not listing the
payments on the bill lists to be approved by the Board. Christy signed all of these
payments as an authorized Township signatory.
Christy, 09-008
Page 37
From October 2004 through July 2008, Christy realized an unauthorized financial
gain of $2,462.36 when she issued to herself 15 reimbursement checks totaling $2,462.36
for which there was no support documentation on file at the Township building. Christy
signed 14 of the checks as an authorized Township signatory.
Per Fact Finding 88, deemed admitted by Christy, Christy realized a financial gain
of $137,419.66 gross ($95,755.34 net)by utilizing her position as Township
Secretary/Treasurer to issue to herself extra payroll/reimbursement checks without the
approval of the Supervisors and by falsifying Township documents to conceal unjustifiable
payments to herself during the time period of 2004 through 2008.
With each element of a violation of Section 1103(a) established, we hold that
Christy violated Section 1103(a) of the Ethics Act when, during the time period of 2004
through 2008, she used the authority of her public position for private pecuniary benefit by
authorizing payments to her which were neither approved nor authorized by the Board.
Cf., Dotts, Order 1548; Neff, Order 1498; Peak, Order 1438; Rhone, Order 1430; Walters,
Order 1361.
As for a monetary penalty, Section 1107(13) of the Ethics Act empowers this
Commission to direct payment of restitution in instances where a public official/public
employee has obtained a financial gain in violation of the Ethics Act.
We determine that restitution in the amount of $95,755.34 is warranted in this case.
Accordingly, Respondent Christy is directed to make payment of restitution in the amount
of $95,755.34 payable to Muddy Creek Township and forwarded to this Commission by no
th
later than the thirtieth (30) day after the mailing date of this adjudication and Order, for
processing.
Noncompliance will result in the institution of an order enforcement action.
IV.CONCLUSIONS OF LAW:
1. As Secretary/Treasurer for Muddy Creek Township (“Township”), Butler County,
from January 2002 to October 27, 2008, Respondent Dixie Christy (“Christy”) was a
public official/public employee subject to the provisions of the Public Official and
Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq.
2. Christy violated Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), when,
during the time period of 2004 through 2008, she used the authority of her public
position for private pecuniary benefit by authorizing payments to her which were
neither approved nor authorized by the Township Board of Supervisors.
3. Restitution is warranted in this case.
In Re: Dixie Christy, : File Docket: 09-008
Respondent : Date Decided: 4/19/10
: Date Mailed: 4/21/10
ORDER NO. 1556
1. As Secretary/Treasurer for Muddy Creek Township (“Township”), Butler County,
Dixie Christy (“Christy”) violated Section 1103(a) of the Public Official and
Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1103(a), when, during the time
period of 2004 through 2008, she used the authority of her public position for
private pecuniary benefit by authorizing payments to her which were neither
approved nor authorized by the Township Board of Supervisors.
2. Christy is directed to make payment of restitution in the amount of $95,755.34
payable to Muddy Creek Township and forwarded to the Pennsylvania State Ethics
th
Commission by no later than the thirtieth (30) day after the mailing date of this
Order for processing.
3. Non-compliance with Paragraph 2 of this Order will result in the institution of an
order enforcement action.
BY THE COMMISSION,
___________________________
Louis W. Fryman, Chair