Bookkeeper misappropriated funds from seven Yakima-area governments, auditors find

Several irrigation and drainage districts near Yakima hired the same bookkeeper who misappropriated public funds through a variety of schemes, according to a report published today by the Office of the Washington State Auditor.

“It is unusual to see a single fraud report involving seven different local governments. However, the root problem is far too familiar, especially within small governments – a lack of strong financial controls, and of appropriate checks and balances,” said State Auditor Pat McCarthy.

Investigators found the bookkeeper was allowed to approve and modify payments to herself, leading to a variety of misappropriations and questionable payments over four years. Examples include:

• Charging a district for expenses that exceeded the approved budget for her services
• Processing payroll claims for the total amount of her annual contract within six months
• Claiming a total of 24 hours worked in the same day, across three districts
• Cashing out sick leave, which was not allowed by district policy
• Billing multiple districts for the same office supplies, resulting in reimbursement higher than the actual costs of the supplies

Auditors identified a total of $9,151 in misappropriations and $17,706 in questionable disbursements between June 2019 and June 2023.

“Any loss of public funds is a serious matter, but the smallest governments can ill afford the expense of a loss and the resulting investigation. The total spending questioned in our report is greater than the annual revenue of four of the irrigation districts involved,” McCarthy said. “I appreciate the commitment of those district commissioners who pledged to accept our recommendations and improve their controls.”

The seven districts affected by misappropriations are Yakima County drainage districts 7, 11, 12, 16 and 28, as well as Union Gap and Wenas irrigation districts.

As a matter of standard practice, the State Auditor’s Office refers all fraud investigation reports to the local county’s prosecuting attorney.

The full report can be found here: Yakima-area governments fraud report

After several small cities and local governments experienced misappropriations last year, the State Auditor’s Office launched a campaign to better educate government leaders about combating fraud. Resources to help governments of all sizes prevent fraud are available on the Office’s website: Preventing Fraud | Office of the Washington State Auditor

Media questions: Assistant Director of Communications Adam Wilson, Adam.Wilson@sao.wa.gov, 564-999-0799