Iowa Auditor of State Rob Sand today (Thursday), released a report on a special investigation of the City of Hastings (in Mills County), for the period covering December 1st, 2018 through May 31st, 2020. The special investigation was requested by City officials as a result of concerns regarding certain financial transactions processed by the former City Clerk, Darren Gray. Sand reported the special investigation identified more than $8,400 worth of improper disbursements and over $3,470 of unsupported disbursements.

The improper disbursements identified include nearly $4,900 worth of unauthorized payroll to Gray and the related City share of the payroll costs. The improper disbursements identified also include over $1,730 worth of improper reimbursements to Gray, and about $1,684 worth of late fees and interest. Auditor Sand says the $3,472 of unsupported disbursements identified includes $1,966 in payments to Darren Gray’s wife, for training she provided to her husband.

Sand reported it was not possible to determine if additional amounts were improperly disbursed or if any collections were not properly deposited because adequate documentation was not available.Sand recommended City officials implement procedures to ensure the City’s internal controls are strengthened, including segregation of duties, performing independent reviews of bank statements, reviewing payroll records, and ensuring all disbursements are properly supported, approved, and paid in a timely manner.

Copies of the report have been filed with the Iowa Division of Criminal Investigation, the Mills County Attorney’s Office, and the Iowa Attorney General’s Office. A copy of the report is available for review on the Auditor of State’s web site at https://www.auditor.iowa.gov/reports/audit-reports/.