Former town clerk in hot water

Audit findings

This is the worst example of board oversight I have seen in my 29 years of government auditing experience.”

Cindy Byrd

Former Washington Town Clerk/Treasurer Susan Noel has been accused of misappropriation and/or unauthorized expenditure of $1,022,412 in town funds.
That’s what a forensic audit by State Auditor and Inspector Cindy Byrd turned up.
“This is the worst example of board oversight I have seen in my 29 years of government auditing experience,” Byrd said in her audit report released July 15.
“The Town of Washington is a small community with limited resources. From FY2021 to FY2024, roughly one-third of the Town’s total expenditures were either fraudulently misappropriated or spent without board authorization. The responsibility for the financial welfare of the town ultimately rests with the board, which failed to exercise oversight of Town finances as required by law.”
Byrd mentioned in her findings that multiple trustees did seek more information on the town’s finances.
“However, it is important to note that not all trustees responded in the same manner. Trustee Joel Siria and former Trustees Duane Branham and Kara Cook raised concerns about the Town’s financial practices and sought access to the financial documents and records of the Town,” Byrd’s report said. “Noel and Aday resisted in providing those documents.”
Among the problematic findings are:

Misappropriations
Susan Noel misappropriated $676,368 via checks, debit card purchases, digital payment platforms, and other transactions, including $267,160 paid toward Bank of America credit card accounts belonging to Noel and her spouse. $25,979 in Amazon purchases primarily delivered to Noel and her family members. Items included a memory foam mattress, a sectional couch, an espresso machine, a cordless vacuum cleaner, a vibration plate exercise machine, a counter top ice maker, a file cabinet and electric dog clippers.
Byrd said $30,681 was transferred into Noel’s personal Venmo account and used primarily for dog-related expenditures, such as grooming and transportation.

Payroll Abuses
The audit revealed $70,607 in unauthorized payments or benefits to Town employees. From 2012 to 2019, Noel failed to remit payroll taxes to the IRS, leaving the Town with debt, interest, and penalties totaling $176,887.
Without Board knowledge or approval, Noel spent $210,400 on tax resolution services. No portion of the money was applied to the Town’s tax debt, interest or penalties, the audit uncovered.

Missing Revenue
Byrd found at least $72,656 in Town revenue was misappropriated because Town employees failed to deposit utility cash collections. She also said $22,200 in cemetery lot sales were not collected or, if collected, were not deposited.

Obstruction of Investigation
Susan Noel altered payee and vendor identification information on bank statements submitted to SA&I in an apparent effort to conceal fraudulent expenditures and obstruct the audit process.
“Regular audits are an important part of financial oversight because they help identify weaknesses,” Auditor Byrd said.
“In this case, the lack of timely audits allowed fraud to flourish. While an audit cannot guarantee fraud prevention, audits could have identified the warning signs earlier, giving the Town the opportunity to mitigate its losses. Our team did an outstanding job, overcoming significant obstacles, to get to the bottom of this entire scheme,” Byrd said.
The Town’s financial operations were primarily administered by Noel and the Town Administrator Paul Aday.
In the audit, Byrd’s findings report Aday misappropriated $705 in Town funds by making five unauthorized purchases with his Town-issued debit card.
In their respective positions they exercised substantial control over the Town’s day-to-day operations, the audit said.
For most of the audit period, in addition to Noel and Aday, the Town employed a staff of four individuals: Noel’s daughter Kasey Lesher the utility billing clerk, Noel’s son-in-law T.R. Lesher the Town’s water operator and maintenance worker and two police officers, Rubin Ruiz, Jr. and Larry Watts.
Bank records reflected that Noel and Aday were the sole signatories on the Town’s bank accounts from April 18, 2008, through July 18, 2024, the date Noel was terminated.
Noel served in her role as town clerk with financial oversight of the Town for approximately 17 years, from 2007 through July 2024, while Aday was employed by the Town for approximately 31 years, from 1993 through September 2024. The evidence established that Noel and Aday exercised extensive authority over Town finances.

A link to the full audit can be found here.