03022020 - News Article - Audit demands Stidham repay $14,000 in misconduct case

Audit demands Stidham repay $14,000 in misconduct case
NWI Times
March 02, 2020
https://www.nwitimes.com/news/local/govt-and-politics/audit-demands-stidham-repay-in-misconduct-case/article_7c75909d-560c-547d-91cf-1bfb533a106f.html

PORTAGE — Former Clerk-Treasurer Christopher Stidham now faces a call to reimburse the city and the state a total of $14,564.55 following a State Board of Accounts investigation into misconduct in his office.

The State Board of Accounts made public a “Special Investigative Report of the Clerk-Treasurer, City of Portage.”

The report’s conclusions echo allegations made earlier this week by Special Prosecutor Stanley Levco, who is charging Stidham with a felony count of official misconduct.

The criminal charge alleges Stidham misused his position as the city’s top fiscal officer in 2015 and 2016 to illegally pay city funds to companies registered to his then-girlfriend, now-wife, Rachel E. Glass.

Stidham, who served as Portage’s clerk-treasurer from 2013 until last year, declined comment on the criminal count. He previously denied all wrongdoing, claiming he was a victim of a political smear.

Stidham is scheduled to appear March 13 in Porter Superior Court for an initial hearing on the criminal matter.

The State Board of Accounts, which oversees public spending by municipal and other branches of local government, conducted an independent probe of Stidham and the city’s financial transactions late last year.

State auditors said they were called into the case by Portage. Former Mayor James Snyder first appointed a committee of city investigators to look into allegations of misconduct in Stidham's office three years ago. Former Mayor John Cannon resumed the investigation last year.

The mayor’s committee discovered records showing Stidham had made questionable use of public funds to three vendors: Keeping the Books, E.R.G Advisors and Paramount Technology Solutions — all established under the name of Rachel Glass — without the approval of the Board of Public Works, a panel of the mayor’s advisers.

City investigators contend the three vendors were shell corporations with Valparaiso addresses for two houses and a United Parcel Service store.

State Board of Accounts auditors concluded from their own probe Stidham paid vendors, associated with his wife, $8,000 in 2016 to assist the city in routine confirmation of the accuracy of the city’s financial records by comparing them to bank account records.

But state auditors found the bank reconcilements for which the city paid $8,000 in 2016 weren’t performed until 2018, two years later.

The report explains state law forbids public officials paying private vendors until after the work is performed and documented, usually by an itemized invoice.

State auditors allege the city had no written contracts with the three vendors associated with Stidham’s wife officially setting the term of services the city expected or the rates she would be paid.

The report states, “It is our position that the City paid for services not received (or approved by the city’s Board of Works.)"

State officials want Stidham to reimburse the city for the $8,000 he wrongly disbursed.

State auditors also are calling for Stidham to reimburse their agency $6,564.55 for the cost of conducting their special investigation.

State auditors forwarded their report on Stidham to the Office of the Indiana Attorney General and special prosecutor, so civil or criminal courts can enforce the payment of the reimbursement demanded.