09/23/2024 - Jefferson City, MO
A new report released today by Missouri State Auditor Scott Fitzpatrick sheds additional light on the questionable decisions made by the former Washington County Collector that led to her removal from office and criminal charges being filed against her. The audit report, which focuses primarily on the time Carla Zettler held the position of Washington County Collector, gives the office the lowest possible rating of "poor" and recommends county officials continue to work with law enforcement regarding criminal prosecution.
"It's unfortunate the mismanagement of the Washington County Collector's Office was able to go on for so long, but thankfully those who are responsible for misappropriating county funds are being held accountable by law enforcement and the court system," said Fitzpatrick. "We hope our audit report can now provide the county a path forward to strengthen their accounting controls and procedures so county funds can't be misused like this again. County officials have worked with us in good faith thus far and I encourage them to continue moving forward with putting all of our recommendations into place."
The audit of the Washington County Collector's Office began at the request of the County Commission and shortly after former County Collector Carla Zettler was removed from office. The report released today found Zettler did not record or deposit at least $107,081 in county trustee property sales receipts from the sale of over 1,700 properties from 2018 to 2021. The properties primarily consisted of lots surrounding Woodland Lakes and were commonly sold for $1 plus $99 in fees.
Only the $1 collected for the county was recorded, deposited, and distributed by the County Collector's office. The remaining $99 was held, in cash, in envelopes stored in the cash drawer or vault of the County Collector's office until distributed. When the fee money was distributed, $19 of each sale typically went to two County Collector's office employees, and $23 went to the County Trustee, who was Zettler's daughter-in-law. The rest of the fees went to the expense of recording the lots. This resulted in at least $32,500 being paid to the County Collector's office employees and more than $39,000 to the County Trustee.
No justification could be provided to explain why the $19 paid to the employees for each lot sold was appropriate and allowable by state law or why the payments were not processed through the normal payroll process. The compensation per lot paid to the County Trustee significantly exceeded the amount allowed by state law and the county did not issue 1099 forms for the amounts paid to the County Trustee. Additionally, the county could not provide justification to support how the total price for the trustee property lots was determined to ensure the charged amounts were equitable and allowable.
The audit also identifies how Zettler improperly transferred at least $3,700 from the Tax Maintenance Fund bank account to her personal bank account. The former County Collector also made at least $3,211 in questionable disbursements by check and debit card. These questionable disbursements included a $1,000 check Zettler wrote to herself, $1,200 in ATM withdrawals, and debit card purchases made at places such as Wal-Mart and Longhorn Steakhouse. An additional $1,278 in questionable disbursements, which primarily included payments to Verizon and Amazon, were identified by the MSHP between 2019 and 2020.
Another audit finding details how Zettler improperly used the Tax Maintenance Fund to make 5 employee bonus payments, totaling $11,989, during 2021 and 2022, in violation of the Missouri Constitution. Additionally, the former County Collector did not transfer receipts into the Tax Maintenance Fund on a monthly basis as required by state law. Instead, transfers were often made for several months at one time, which made it more likely errors would occur.
The audit report also found the accounting controls and procedures used by the former County Collector had significant weaknesses. Under Zettler, office personnel did not always deposit receipts intact and shared the same cash drawer when collecting receipts. General account bank reconciliations prepared by the former County Collector were not always complete, accurate, or timely. As of January 30, 2023, the former County Collector had only completed bank reconciliations on the general account through August 2022. Zettler also failed to prepare lists of liabilities for the general or the ACH (installment) bank accounts, and consequently, liabilities were not agreed to reconciled bank balances.
As noted in the audit, Zettler also failed to distribute protested taxes in a timely manner and did not maintain protested taxes in an interest bearing bank account as required by state law. She did not distribute $99,429 of protested taxes related to a case that was ordered to be distributed by the State Tax Commission on November 10, 2020. It was not until March 2023, that the current County Collector distributed protested taxes of $90,827 to the political subdivisions and refunded protested taxes of $8,602 to the taxpayer.
Additionally, the audit found the controls and procedures the county has over the property tax system need to be improved, and the current County Collector has not completed and filed an annual settlement for the years ended February 28, 2023, and February 29, 2024, in violation of state law.
The complete audit of the
Washington County Collector and Property Tax System can be found here.
