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Former state employee hits the jackpot…kind of
Wednesday, Apr 2, 2008 - Posted by Kevin Fanning * Yesterday Treasurer Alexi Giannoulias held a press conference to announce this crazy story:
Wow. I’ve heard of state employees receiving generous pension benefits, but she really hit the jackpot. Kirby, who retired from the state in 2006 before Giannoulias took office, was a 33-year employee there, overseeing a unit that processed state deposits. A federal grand jury in the state capital indicted Kirby on charges of wire fraud and money laundering:
* And how exactly did her master plan work?
Prosecutors alleged the net loss to state taxpayers was $263,408, money that she allegedly spent on a boat, a truck, a camper, a vacation to Orlando, a cruise, college tuition and a mortgage payment. The feds are now seeking the return of those funds. * When interviewed, former Treasurer Topinka said “I guess it is conceivable that she could do this without anyone in the office knowing it. I was personally shocked by it, that it happened at all. But since it did, the state should throw the book at her as that kind of stealing is untenable. Makes me sick.” If convicted on all counts, Kirby could be sentenced to 20 years in prison. Giannoulias said his office has created safeguards to prevent similar problems, including multiple layers of review and backup documentation before such transfers are authorized. * This is another job well done by the Treasurer, and is certain to please many tax payers. Glad to see that someone is doing their job…
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- Aaron Slick - Wednesday, Apr 2, 08 @ 8:58 am:
Go get em, Alexi. We can certainly use another broom down in Springfield. Patrick Fitzgerald can’t do it all. The sad part is that despite the statements that Kirby could get a sentence of up to 20 years, the reality is that she will probably only serve 1 year and then be put on probation. This is a white-collar crime. Judges don’t consider white-collar criminals as very dangerous so they give them minimal sentences no matter how many people were hurt by their criminal actions. This, in turn, encourages others to commit white-collar crime because it offers enormous rewards with very little risk. In the unlikely event that you get caught, only a hand slap awaits you.
- North of I-80 - Wednesday, Apr 2, 08 @ 9:01 am:
Pretty slick. Should be interesting to read how it was discovered and tracked back [although using her mothers’ address might have been sloppy]. Will she be housed at the same facility as our other State officials/governor/advisors or in a separate women’s facility? Great work for the good guys.
- Douglas M. - Wednesday, Apr 2, 08 @ 9:05 am:
I wonder if the IRS will hit her up for taxes on this amount since the money was available to her. Why weren’t measures in place to prevent one person from having the ability to pull off this scheme? Auditors should have caught that.
Pingback More GOP Book Cooking? Needs a Little Salt « Illinois Reason - Wednesday, Apr 2, 08 @ 9:08 am:
[…] Now, we learn that somebody in Republican former State Treasurer Judy Baar Topinka’s office has been indicted for stealing three quarters of a million dollars. That’s a lot of coupons to clip… This woman apparently used the money she stole to pay college bills, buy a yacht and go on a cruise and is now facing up to 20 years in Club Fed. […]
- wordslinger - Wednesday, Apr 2, 08 @ 9:09 am:
Scary that she was able to do this. She was there 33 years. Makes you wonder if she did it before.
- Anonymous - Wednesday, Apr 2, 08 @ 9:15 am:
First getting us out of the hotel fiasco, now this.
Bravo Mr. Treasurer, THAT is what I call fiscal watchdog. Now imagine what he could uncover and correct if we handed his the Governor’s office.
- You Go Boy - Wednesday, Apr 2, 08 @ 9:15 am:
Yet another example of Judy Bar Competence
- Frank Booth - Wednesday, Apr 2, 08 @ 9:18 am:
A Fitzgerald/Giannoulias ticket for gov/lt gov is getting more appealling by the day.
- Ghost - Wednesday, Apr 2, 08 @ 9:26 am:
But he worked and a bank that gave loans to old people with money! We need to stop the insanity and abuse of letting the eldery borrow money from banks! Now it comes out that he failed to stop a transfer that occured at some bank somewhere while he was invovled with banks?!? And he claims no responsibility, off with his head! He must take repsonsility for all bank transfers that have occured while he worked at A bank!!!
- jerry 101 - Wednesday, Apr 2, 08 @ 9:29 am:
Wow, Alexi better be careful. People might start thinking that there’s someone competent in Springfield.
The Hair is standing on end.
And Judy looks like an idiot.
- Snidely Whiplash - Wednesday, Apr 2, 08 @ 9:41 am:
Don’t they have to undergo an annual audit? How a $400k-plus transfer, followed by a later redeposit of those funds, without any documentation showing the basis for neither the transfer nor the deposit, could have gone undiscovered by audit is inconceivable. My guess is that the audit was completed after the fiscal year in which the theft took place, and it took this long to trace back the discrepancy.
I wouldn’t blame Topinka for this. It happened right before she left office; she didn’t have the luxury of having audit results and then the time to track down the error in the numbers. I also wouldn’t be so quick to give the credit for uncovering it to Mr. Press Conference, since I highly doubt he was personally involved. Most likely, as I said, it was discovered as part of an audit process that had nothing to do with Giannoulias.
If the theft had occured in 2003 and Topinka had found it and called a press conference, no one would be saying, “good job,”; they’d be blaming her for the employee’s theft.
This was a criminal act, and it’s good that it was uncovered. But really, to act like Giannoulias is the second coming because he had this political gift horse land in his lap following an audit procedure is pretty naive.
- VanillaMan - Wednesday, Apr 2, 08 @ 9:57 am:
All hail Giannoulais for doing his frickin’ job!
- Gambler - Wednesday, Apr 2, 08 @ 10:00 am:
Two more former state employees have really hit the jackpot at the Illinois Gaming Board. Illinois State Police Luis “The Rezko Clout List” Tigera has been transferred to protect him from public scrutiny about his “clout” in public Board meetings. Tigera negotiated two “jackpot” transition contracts for Mark Stevens and Tommie Wofford. Each retired Illinois State Police official will receive $105,000 for personal service contacts. I don’t know how they get around the State Employee’s Retirement System’s 75 day limitations. Each will be making over $200,000 with their pensions and contracts. It must be Tigera’s clout. Tigera creates real jackpots for his friends and himself.
- Bill S. Preston, Esq. - Wednesday, Apr 2, 08 @ 10:02 am:
News of this makes me feel even better about my supportive comments of Giannoulias yesterday. I’m waiting for VanillaMan to comment that this isn’t real public service and that Giannoulias shouldn’t be trusted. Bring it on.
Job well done, Treasurer. Care to comb through the books of other offices? Perhaps the Governor’s?
- Kevin Fanning - Wednesday, Apr 2, 08 @ 10:07 am:
Snidely,
It was an internal audit from within the treasurer’s office. Additionally, I wouldn’t exactly call this a gift horse. This happened because Topinka’s staff wasn’t accurately accounting for their work. The employee was able to get away with this because she was there for 33 years and knew that in 2007 they were still using paper to account for the tax receipt. Give praise where praise is due.
- Dan S, a Voter - Wednesday, Apr 2, 08 @ 10:21 am:
So how are “Public Oficial A”,Defendant Rezco and convict Levine involved? The money trail always some how seems involve them.
- Wumpus - Wednesday, Apr 2, 08 @ 10:51 am:
I thought this was a Mel Reynolds thread. Yes, this does make JBT look silly, but lets not forget about $1mil to Th eloop School/church and another million as well for Rod
- Enemy of the State - Wednesday, Apr 2, 08 @ 11:38 am:
Sounds like she is ready to get in the inner circle. Has she actually been arrested?
- Cassandra - Wednesday, Apr 2, 08 @ 11:39 am:
My impression is that these kinds of thefts by employees familiar with the accounting system are fairly common in many workplaces, although this one seems noticeable because of the amounts involved.
The New York Times last week had an article on a recent report based on data from the Association of Certified Fraud Examiners which estimated that
charities lost about $40 billion to fraud in 2006, or about 13 percent of total charitable revenues.
Hard to believe in the computer age. But the widespread nature of this kind of theft suggests
that both government and nonprofits are a long way from having adequate accounting controls.
- Dirt Guy - Wednesday, Apr 2, 08 @ 11:44 am:
Wow. A State agency that is doing what it should be doing. Good job, but why all the fawning because they actually did their job? FYI. Most governments and businesses can and do find these errors. It’s just that we have come to expect gross incompetence from our state government. Sad.
- Moderate Repub - Wednesday, Apr 2, 08 @ 12:22 pm:
This is another job well done by the Treasurer, and is certain to please many tax payers. Glad to see that someone is doing their job…
THats a little much. He wasnt the one that found the error, wasnt it a Federal Audit? Not that I am saying he shouldnt go get press out of it, (good measures to make sure it didnt happen again) but his office wasn’t the one who found the $750,000.
- Budget Watcher - Wednesday, Apr 2, 08 @ 12:26 pm:
I’m not sure how much praise is necessary when someone (or his staff) simply does their job. Was this a case of extraordinary financial detective work, or just a routine internal audit that revealed an extraordinary theft? The truth is, we don’t know.
- Kevin Fanning - Wednesday, Apr 2, 08 @ 12:26 pm:
Moderate Repub-
https://capitolfax.com/2008/04/02/former-state-employee-hits-the-jackpotkind-of/#comments
Again, it was an internal audit. His office found the mistake.
- mike - Wednesday, Apr 2, 08 @ 12:40 pm:
Kevin - you might wanna check the article by Finke as it claims the IRS contacted the Pekin hospital looking for the payroll tax money that was inadvertently sent to the Treasurer. The hospital then contacted the Treasurer and then the investigation was launched. The IRS initiated the investigation.
- Dominique - Wednesday, Apr 2, 08 @ 12:51 pm:
Alexi still employs the Internal Auditor and Inspector General hired by Judy. If an internal audit caught the theft it was then caught by competent people chosen by her.
- Princeville - Wednesday, Apr 2, 08 @ 12:53 pm:
Kevin-okay, praise to Giannoulias n staff for tracking it down and figuring it out, but had Pekin Hospital not been beating his door down demanding to know what happened to the money, would it even have been discovered? There’s a better story than the Suntimes in the Springfield paper this morning that gives a better time line and ‘explaination’.
Makes one wonder how many little amounts may have been lifted around and never noticed. And why after the hospital asked about it the first time (when first aware a problem ‘we’re working on it’) did it take so long to get serious about the money whereabouts
- Kevin Fanning - Wednesday, Apr 2, 08 @ 12:54 pm:
A direct quote from the treasurer’s press release yesterday:
“Current State Treasurer Alexi Giannoulias’ office recently discovered evidence of wrongdoing and launched an internal investigation before forwarding its findings to the Springfield office of the FBI.”
- mike - Wednesday, Apr 2, 08 @ 12:57 pm:
that is correct but they discovered the evidence of wrongdoing after they were contacted by the Pekin hospital wondering what happended to their payroll taxes that were inadvertently sent to the treasurer rather then the IRS. of course they launched an investigation after being told the money was missing….
- Kevin Fanning - Wednesday, Apr 2, 08 @ 1:14 pm:
mike-
Also from the press release…
“The Treasurer’s Office received a payment of $263,408.41 that Pekin Hospital erroneously made out to the Department of Revenue but was intended for the IRS. Following procedures to return money to the Pekin Hospital or forward it to the IRS, Treasurer’s Office staff debited the Revenue Department’s account and created a special suspense account to hold the funds.”
My understanding from that is that they caught it, not the hospital. Either way though, who cares? They’re the ones who did all the track work to figure out how a former employ embezzled $750,000.
- Snidely Whiplash - Wednesday, Apr 2, 08 @ 1:16 pm:
Okay, so NOW not only did employees hired by Topinka find the theft, but the audit was intitiated by inquiries OUTSIDE the treasurer’s office. All hail Giannoulias! It never would’ve been uncovered if not for him!
- Kevin Fanning - Wednesday, Apr 2, 08 @ 1:17 pm:
Snidely,
See comment directly above.
- Anonymous - Wednesday, Apr 2, 08 @ 1:23 pm:
you people are crazy.
who cares who launched what investigation. they busted the woman and she’s going to be held accountable.
the story isn’t whether giannoulias or the IRS is responsible for unearthing this stuff, its how prior administrations let this one through the wickets.
- The Rookie - Wednesday, Apr 2, 08 @ 1:30 pm:
What’s wrong with some people just saying that is was a “good job.” Is it really necessary to lament over who gets the majority of “kudos” in this horrific act??
Pekin Hospital, Alexi Giannoulias, IRS, Alexi’s staff (including Internal Auditor and Inspector General– they ARE still apart of HIS office right?), and YOU the everyday citizen should ALL be applauded for this investigative work! Isn’t that what Kevin was stating to begin with? Job well done to all parties involved.
How does that sound?? Sheesh!?
- Little Egypt - Wednesday, Apr 2, 08 @ 2:24 pm:
I seem to recall reading somewhere yesterday that Alexi has been cleared of any wrongdoing in the loan to the 80 year old prior to becoming State Treasurer. Can anyone else confirm that they read about this as well?
- Bill S. Preston, Esq. - Wednesday, Apr 2, 08 @ 2:39 pm:
We commented on the story here yesterday Little Egypt. Here’s the Sun-Times link.
http://www.suntimes.com/news/metro/870821,CST-NWS-TREAS01.article
- Irish - Wednesday, Apr 2, 08 @ 3:19 pm:
Just a comment from the peanut gallery. If the Treasurer’s Office is like all of the other offices in the State it might not have had an audit in some time. We had not had an audit in six years until last year. There simply were not enough auditors to keep up. Many had taken the early out in 2002 and others were cut about the same time. The positions were not filled due to budget restraints until they started to fill them last year. Our new auditor came from Chicago not Springpatch. I hope the Treasurer’s office and the Comptroller’s office would have audits more frequently but I know our agency and others have not had audits for quite a while.
- zatoichi - Wednesday, Apr 2, 08 @ 3:57 pm:
This whole thing sounds like a cheap movie money scam without George Clooney/Brad Pitt dropping a couple million into a Swiss bank account. If this person moved $486,000 from a bank account wouldn’t the bank have to report that size of transfer both into and out of their bank? At the hospital, some auditor would be asking where a check and paperwork this size fit together.
Who cares how this was discovered? Alexi has the watch and regardless of what he did personally, the behind the scene people and other groups found it. So he gets some good PR out of it. That will simply balance out some other not so good event that will eventually occur. Simply part of the job/circumstance.
Following the cheap Hollywood plot, inquiring minds have to ask how long this went on, how much is buried in other banks or in the freezer, and who else done a similar gag going. It is unfortunate that this is not a rare incident in the world of white collar crime. Temptation, a financial need, available money and a “I can cook the books” mentality/rationale is tough combo. Hope she does more than a just couple of years.
- Team Sleep - Wednesday, Apr 2, 08 @ 4:15 pm:
Second coming? No. But it is refreshing for a state official to actually take this course of action. Does anyone really think Blago would audit his own offices? Or even any of the other elected officials? Probably not. If they do, do things like this - not as large-scale but still nefarious - get held down and never released? It makes one wonder…
- Anonymous - Wednesday, Apr 2, 08 @ 4:42 pm:
team sleep - blago’s “offices” (ie all of the code departments) typically undergo some type of audit every 2 and/or 4 years.
there are several different types of audits (some look at the performance of a program, others focus only on the financials for example) so the type and scope can differ.
in the end, audits are being conducted usually by ’special assistant auditors’ (outside accounting firms who work with the auditor general’s office) and these findings can be found in an agency’s public audit that’s released.
and most of the time you’ll find an agency director appearing before the legislative audit commission defending his/her department in an attempt to minimze the material findings provided for in the audit.
- Odyssey 2010 - Wednesday, Apr 2, 08 @ 4:53 pm:
What’s up with all the haters today?
Everybody have candidate Alexi grief for proposing an audit of Bright Start when he first ran, but guess what, he did it, found useful info, and turned around an important program.
People made fun of him because of the eBay proposal, did it anyway, and it is a success.
Then, the hotels. Now this, and people want to dispute the credit he is getting from this. What a crowd!
Can anybody quantify what Giannoulias is saving Illinois taxpayers by (1) cutting his budget; (2) unloading those hotels; (3) new investment strategies; and (4) getting this money back?
- Budget Watcher - Wednesday, Apr 2, 08 @ 6:21 pm:
Certainly the Treasurer has done some very commendable work since taking office…but, Kevin’s “attaboy” for the Treasurer’s office simply detecting a blantant theft of funds more than a year after it happened is not especially praiseworthy in my opinion. It doesn’t make me a “hater”, just someone who who doesn’t feel the need to cheer everytime an elected official does what we elected him to do.
- bluedog demo - Wednesday, Apr 2, 08 @ 8:20 pm:
Alexi is going to ” lock up ” with Lisa in a primary showdown for Guv next time around. When President Obama comes back to campaign for his guy Lexi don’t believe Papa Mike will be able to
counter the ” Big O ” !
- Soon to Retire - Wednesday, Apr 2, 08 @ 9:10 pm:
Gambler, you are so wrong, Tigera had nothing to do with those contracts , in fact he tried his pull to get them stopped , he hates Stevens as Stevens tells him where Tigera can shove it,it was the IGB Administrator who got the contracts in , it is a sweet deal.
- Moving to a Red State - Wednesday, Apr 2, 08 @ 10:31 pm:
This is so amusing. Maybe Giannoulias doesn’t deserve any credit for uncovering this, or for “just doing his job”, but he certainly looks good compared to this Dream Team of other Democratic statewides (and I’m not referring to the 1992 U.S. Men’s Basketball team, but to Michael Keaton’s Dream Team):
Rod Blagojevich. . .no further comment needed
Pat Quinn. . .couldn’t have a more fitting personality for a position that doesn’t do anything
Jesse White. . .at least he “tumbles” in all those parades
Dan Hynes. . .ever since he established the “rainy day” fund, all he can do is rip on Rod and remind us that he established the “rainy day” fund.
Lisa Madigan. . .if she were U.S. Attorney General, she would be a regular Saturday Night Live parody. At least her vaunted public integrity unit has done a Grade A job investigating how the Speaker of the IL General Assembly practices law before the Cook County Board of Review, a lobbyist who in turn gets paid to lobby the Speaker down in Springfield (oh, wait — that’s just wishful thinking).
How about this, we moderate Repubs will trade you Judy and two players to be named later for Giannoulias. You can keep the Dream Team.
- One bad apple infects the entire BARREL! - Wednesday, Apr 2, 08 @ 11:04 pm:
For you who say that he is “just doing the job we elected him to do.” That may be so…
… But what’s wrong with giving a bit of praise and a pat-on-the-back when they have shown a track record of doing their job well!?? Has he not done his job above par since being elected? Is it wrong not to take a bit of pride and ownership in a IL official showing some decency and pride in their position? I don’t understand all the downplaying on this thread??
By the way… I enjoyed the posts of Odyssey 2010 & The Rookie. Good job, bloggers!
Ooops!? I mean… Pwsstt?? No biggie, O-2010 & Rook! Anyone could have said that!
lol!
- Odyssey 2010 - Wednesday, Apr 2, 08 @ 11:46 pm:
Moving -
You could offer us the GOP’s entire roster, we’re keeping Giannoulias.