Maverick County Commissioners Court approve Sheriff’s Department Confiscated Funds Audit Report & Findings for 2010-2012 and Refer Matter for Investigation
By: Jose G. Landa, Eagle Pass Business Journal, Inc., Copyright 2016
Maverick County Commissioners Court held their regular monthly meeting on Monday, February 8, 2016 and heard a presentation by Eli Mendoza of the auditing firm of Garza/Gonzalez and Associates of San Antonio, Texas regarding their Audit Report and Findings and Recommendations concerning the Maverick County Sheriff’s Department Confiscated Funds for the 2010-2012 years and unanimously approved the Audit Report together with a recommendation to refer the matter to law enforcement for investigation.
Maverick County taxpayers have expressed mixed concerns regarding the action unanimously approved by Commissioners Court with some glad that the matter should be referred to law enforcement authorities for investigation of the Audit’s Findings and Recommendations while others believe the timing is politically motivated and suspect due to the Early Voting Period of the Texas Primary Election is only eight days from commencing on February 16, 2016 with both former Sheriff Tomas S. Herrera and current Sheriff Tom Schmerber battling for the Maverick County Democratic Party nomination for Sheriff in the March 1, 2016 Primary Election, together with retired Eagle Pass Police Department Detective Sergeant Johnny Munoz also seeking the nomination.
Commissioners Court approved an audit be conducted of the Maverick County Sheriff’s Department Confiscated Funds for the limited years of 2010-2012 as requested by Sheriff Tom Schmerber at an October 15, 2015 meeting. Former Sheriff Tomas S. Herrera served during 2004-2012 while current Sheriff Tom Schmerber has served during 2013-Present.
During the presentation of February 8, 2016 under agenda item No. 14, Eli Mendoza of Garza/ Gonzalez and Associates, Certified Public Accountants, stated that his firm would be setting a disclaimer on an opinion for the audit performed on the Maverick County Sheriff’s Department Confiscated Funds during 2010-2012. In other words, the firm of Garza/Gonzalez and Associates was not able to give a professional opinion that its audit findings and recommendations are completely true and accurate due to record keeping discrepancies of Maverick County.
After giving his firm’s disclaimer, Mendoza proceeded to give a presentation overview on the audit conducted by his firm of the Maverick County Sheriff’s Department Confiscated Funds during 2010-2012 to Commissioners Court.
Mendoza stated “The County Sheriff’s Department did not maintain a general ledger nor other records adequate to conduct an audit of the Confiscated Funds in accordance with Generally Accepted Auditing Standards or a program specific audit of the equitable sharing federal program in accordance with governmental auditing standards. Since the County’s accounting records for the Sheriffs Department Confiscated Funds are inadequate, and we were not able to apply auditing procedures, the scope of our work was not sufficient to enable us to express, and we do not express, any opinions on these financial statements.We noted certain matters which we have reported to management of the County’s Sheriff Department in a separate letter dated February 2, 2016.”
“Looking at the numbers for these three years, we came across findings and recommendations and those are noted separately,” added Mendoza.
Mendoza noted that there was a lack of records to support disbursements.
“During our testing of the Equitable Sharing Agreement and Certification reports for the years 2010, 2011, and 2012, we noted that the expenditures reported do not agree with/or to the Excel spreadsheet that the Sheriff’s Department uses to track expenditures. No documentation exists in support of the amounts reported. For 2012, the expenditures reported appear to be the amount of the receipts and not the actual expenditures,” said the Audit Report.
County Judge David R. Saucedo and Eli Mendoza discussed the issue of confiscated funds and what responsibility falls on the County Administration and Sheriff’s Administration in handling such funding.
Some of the important findings under the audit presented by Garza/Gonzalez and Associates were non-compliance on reporting measures as required by federal law for the Equitable Sharing Program, the lack of a written procurement policy in place and non-permissible expenditures.
“ Twenty-two (22) checks totaling $136,342 were paid to Maverick County for payroll costs. However, the payroll costs may not be properly charged to the Equitable Sharing Program since the Equitable Sharing Program had a deficit cash balance. Federal guidelines do not allow payroll expenses, except for temporary employees or for overtime pay. Six (6) instances were noted where employees received a payroll loan from the equitable sharing funds. Each check was made payable to an employee in the amount of $1,000. Although the loans appear to have been repaid by the employees, lending funds is not a permissible use of equitable sharing funds. Four (4) checks issued in 2010 selected for testing did not have supporting documentation,” states the Audit Report.
Other issues raised in the audit report include missing/not-located documentation on purchases of vehicles and Five (5) vehicles purchased could not be accounted for by the Sheriff Department’s staff. Invoices containing vehicle identification could not be located or obtained from the vendor. A vehicle (2006 Dodge Ram 1500) is being used by the County Fire Department. Such use does not appear to be a permissible use of funds, noted the Audit Report.
“We recommend that the Sheriff Department further investigate the location and ownership of the five missing vehicles. Further, future vehicles purchased with confiscated funds must be used for law enforcement activities,” stated the Audit Report.
The audit report further states that Chapter 59, Asset Forfeiture Reports, were not filed by the Sheriff’s Department for the 2010 to 2012 years. “Further inquiries to the State of Texas, no such
reports were filed by the Maverick County Sheriff’s Department from 2004 to 2012.”
“We recommend that the Sheriff’s Department file reports required by State law,” states the Audit Report.
Commissioners Court decided to go into Executive or Closed Session to consult with legal counsel regarding the Maverick County Sheriff’s Department Confiscated Funds for 2010-2012 Audit Report and its Findings and Recommendations.
After returning into Open Session, Commissioners Court further discussed the Audit Report including the scope of work that was done and what other possible findings could have been found had a more thorough review was done and where would that lead to.
Commissioner Precinct 1 Jerry Morales made a motion on agenda item No.14 calling for the Commissioners Court to direct legal counsel to refer the findings of fact contained in the Auditors Report prepared by Garza/Gonzalez and Associates to the Federal Bureau of Investigation and to the Texas Rangers for an independent law enforcement investigation.
Commissioner Precinct 2 Rosy Cantu seconded the motion and there being no further discussion, the motion to refer the Audit Report’s findings to the FBI and Texas Rangers for an independent law enforcement investigation was unanimously approved by Commissioners Court.
Commissioners Court include County Judge David R. Saucedo and Commissioners Jerry Morales, Rosy Cantu, Pete Venegas, Jr., and Roberto Ruiz.
On Tuesday, February 9, 2016, Maverick County Sheriff Tom Schmerber and County Commissioner of Precinct 4 Roberto Ruiz held a press conference regarding the Audit Report and its Findings and Recommendations done by Garza/Gonzalez and Associates concerning the Maverick County Sheriff’s Department Confiscated Funds for the years 2010, 2011 and 2012 and the action taken by Commissioners Court the previous day.
During the press conference, Sheriff Tom Schmerber re-affirmed the findings on the audit report that warranted for a decision by the Maverick County Commissioners Court to petition for further law enforcement intervention from the federal government such as the FBI.
Sheriff Schmerber stated at the press conference that such reports and audits are supposed to be conducted on a yearly basis on Confiscated Funds which had not been done for the years 2010, 2011 and 2012.
Sheriff Schmerber was questioned by a local reporter at the press conference if said yearly reports and audits had been done similarly to the fiscal years of 2013, 2014, and 2015 under his administration as Sheriff, and Sheriff Schmerber stated that those reports and audits are currently being worked on and being done. In other words, these reports and audits for 2013-2015 under his administration have not been completed. Thus, Maverick County taxpayers do not know if there are any discrepancies in the Confiscated Funds during Sheriff Schmerber’s tenure. Other members of the press questioned the timing of the release of the Audit Report and its Findings and Recommendations being done one week before the Early Voting Period.
Most importantly, the Audit Report and its Findings and Recommendations by Garza/Gonzalez and Associates regarding the Sheriff’s Department Confiscated Funds during 2010-2012 does not give a professional opinion as to the accuracy and veracity of its findings due to poor record-keeping procedures in Maverick County. Eli Mendoza clearly stated that his firm was expressly disclaiming any opinion concerning the disputed Audit Report and its Findings and Recommendations.
In an interview with the Eagle Pass Business Journal on February 9, 2016, former Maverick County Sheriff Tomas S. Herrera stated “I question the timing and I’m sure they’re politically motivated as they have been made known, five days to early voting in an election where I’m challenging as a candidate for the Maverick County Sheriff position. I welcome such investigation so things can be cleared out.”
Herrera was specifically asked about the Audit Report finding concerning the missing five automobiles and mishandling of funds.
“All paperwork, statements, revenues, expenditures on what you’re referring to is either filed with the County Treasurer’s office or Auditor’s office Inventory, as I left office , I personally called the auditors office ( Mr. Fidencio Ortiz ) if he could send someone from his office to do an audit and inventory of everything that was going to be left there. They sent a representative and they accounted for everything, computers, vehicles and other things and they were all labeled with numbers and all that information is at the county auditors office.” said Herrera.
“Vehicles that are missing, I don’t know why it took them a little over three years to find out that there were five vehicles missing. All those, the invoices and Purchase Orders and titles should be at the county treasurer’s or auditors office for inspection.” added Herrera.
Herrera touched basis on the audit findings that their was funds being loaned out to employees from the confiscated funds account and information that was supposedly erased from computers at the Sheriff’s Office. which according to Herrera was stored in a storage disk which was turned over to the auditors office.
“ The County was short on money, like they’re always short on money, that they didn’t have enough money to make payroll to my deputies, regular time and overtime of the different grants, so their was a call that I received at that time from the County Auditor Carlos Pereda at that time, so I told Mr. Pereda I don’t think I can lend the county any money but I’d be willing to help you all out because I don’t want to see my officers not getting paid during the pay period, they have expenses. He then said let me check into it and he called back and stated, it can be done as long as I make restitution to the confiscated fund once the invoices that we have sent out for collection from the different agencies (state and federal) we’ll be cutting a check and depositing it into the confiscated funds. Which they did, they paid every penny of it. The persons they’re referring to were left out of the payroll for whatever reason, and I saw where they needed monies for expenditures and I advanced them some monies and they repaid the confiscated fund. “ said Herrera.
Herrera stated that he didn’t question County Auditor Carlos Pereda if such action was permissible because he took the word of the County Auditor and he was appointed by the two state District Judges to oversee all County funds.
Another issue that Herrera touched basis on was the findings of credit cards being misused .
“I had one credit card that was issued by a local bank because we always had trouble with the credit cards from the county. They would not pay them off on time. One time I remember I went to Washington D.C. and they would not accept my county credit card so I had to pay for my room and lodging from my own credit card. So I then decided to go to the bank and I was directly billed for that credit card from the confiscated funds as long as it was approved that I could use that card using confiscated funds as permitted for certain uses.” said Herrera.
Herrera further addressed audit findings of funds being co-mingled including confiscated funds.
“ Since day one that I went in as Sheriff for Maverick County in 2004 whatever money that was received in the operations between federal and state agencies they all went into the confiscated funds. One fund, that’s the way it was managed and that’s the way it was left when I left office.” said Herrera. “Maverick County handled its funds this way before I became Sheriff and after I left the Sheriff’s Office,” added Herrera.
So, were funds being co-mingled? “ Yes.” answered Herrera.
“In the eight years that I was Sheriff, I never had the state or auditor bring it to my attention that those funds were co-mingled with other funds.” added Herrera.
“It’s a political year, you start to think, one week before the start of early voting and they come up with this. That smells like politics, rotten politics.” concluded Herrera.
Maverick County has had a bad history of reporting and handling of County funds as well as filing its County Audits on a timely basis, causing the County to lose state and federal grants due to its poor record-keeping procedures. Maverick County taxpayers learned this week that past and current Sheriff’s have not filed timely annual Confiscated Reports and Audits.
