State audit of City of Kennett begins

KENNETT, Mo. — Two representatives of the Missouri Office of the State Auditor met with Kennett City Council members last week to officially begin an audit of city operations and finances, and to discuss in further detail what to expect as the investigation begins.

According to a news release from the State Auditor's Office, the audit was prompted by claims of fraudulent activity — which Pamela Allison, audit manager of the Public Corruption and Fraud Division, told city officials have thus far been found to be credible reports.

"We are here to start the audit," Allison told council members in opening. "Our office received a complaint through our whistleblower hotline regarding fraudulent activities and concerns about the operations and finances of the city. We received those back in March of 2022. Our chief investigator investigated and found those allegations to be credible."

Allison and Sara Woodman, another employee of the State Auditor's Office, secured certain records and computers to take to their office in Springfield, which primarily pertain to a time period ranging from June 5, 2018, through March 8, 2022. She said the city's server and several computer towers had been collected before the meeting took place.

"Because of the whistleblower complaint, we were able to work with the city to do an initial investigation that found the claims of fraudulent activity to be credible," state Auditor Scott Fitzpatrick said in the release. "The city then formally invited us in to conduct a performance audit that we hope will give city officials a full understanding of what happened, as well as identify areas where the city can make improvements to prevent the misuse of tax dollars from happening again."

Kennett City Council members hear from representatives of the Missouri Office of the State Auditor during a special meeting Wednesday, Dec. 6, in Kennett, Missouri.Christian Johnson ~ Delta Dunklin Democrat

A document provided to those in attendance Wednesday, Dec. 6, outlines that the auditor's methodology may include reviewing meeting minutes, written policies and procedures and financial records, as well as interviewing certain personnel and third parties. The Auditor's Office will seek to understand and test internal controls and legal provisions, and they will assess the risk of occurrence of illegal activities such as fraud.

Allison explained that the information collection process can take anywhere from six months to a year in most cases. She said the Auditor's Office will likely perform recorded interviews with anyone believed to be relevant to the case, some under oath. She explained that the office can also subpoena individuals to be interviewed, and they may subpoena records from banks and other vendors.

The audit is being done at no cost to the city, and after all materials are finalized there will be another meeting in closed session with City Council members. The Auditor's Office will then work with law enforcement with any findings of illegal activity, and in conclusion a public report will be released with the audit's findings.

The process to perform an audit began Sept. 6, 2022, and the Auditor's Office formally accepted the audit Sept. 19, 2022.

Individuals may provide confidential information for consideration during the audit to the State Auditor's Whistleblower Hotline at (800) 347-8597, by email at moaudit@auditor.mo.gov or by visiting auditor.mo.gov/hotline.