State auditor finds problems in Cole Co. circuit clerk's office; circuit clerk resigns

Cole County Circuit Clerk Brenda Umstattd resigned Wednesday after a special audit released earlier in the day by state Auditor Tom Schweich identified three main problem areas in the circuit clerk’s office.

In a press release from Presiding Circuit Judge Patricia Joyce's office, Joyce said Gov. Jay Nixon will name a successor. Until a successor is named, Joyce will act as appointing authority for the circuit clerk.

The problem areas cited in the audit included “deficiencies in internal controls, noncompliance with legal provisions (and) at least $14,669 (in) missing monies.”

A number of the issues cited involved the use of manual receipts instead of receipts generated by the computer program tied-in to state records.

Schweich’s Management Advisory Report to Judge Joyce and the three other judges also cited three other concerns as part of the findings.

Among those was a note that Umstattd failed to implement recommendations made by Joyce, the state’s Office of State Courts Administrator (which oversees court operations statewide) and Cole County Court Administrator Marilue Hemmel.

“Many of the weaknesses likely contributed to the misappropriation of funds,” Schweich reported in the “Citizens Summary” at the beginning of the report. “As far back as 2007, (Joyce) expressed concern with untimely recording of receipts and failure to deposit daily.

“In March 2010, (Hemmel) cautioned against using manual receipts.”

The audit report noted problems with the accounting systems resulted in two employees being fired last year and, ultimately, criminal charges filed against them.

In response to the audit, Umstattd's attorney, Scott Hamblin released this statement.

"My client has implemented many of the recommendations contained in the audit by the office of the State Auditor.

Ms. Umstattd inherited the accounting procedures and protocols when she was elected to office which had been used by the court and prior circuit clerks. Consequently, she inherited many of the deficiencies associated with the accounting procedures and protocols highlighted by the State audit.

During 2010 and 2011 one or more clerks were involved in misappropriation of court funds. The misappropriation was initially detected by a court clerk utilizing the existing accounting procedures and protocol. Ms. Umstattd then notified the Presiding Judge and together they contacted the Office of State Courts Administrators and the Missouri State Highway Patrol regarding the alleged theft. A criminal investigation occurred which resulted in the dismissal of court clerks and the filing of criminal charges against those clerks. Ms. Umstattd and the Presiding Judge also contacted the State Auditor’s Office wherein an audit was requested.

The audit by the state auditor revealed schemes by which the misappropriation occurred and suggested changes in attempting to prevent future theft. Ms. Umstattd has implemented many of the recommendations made by the office of the State Auditor. The Office of the State Courts Administrator has recognized the significant improvements made.

Representatives from the Office of State Courts Administrator (“OSCA”) visited with the circuit court’s management team comprised of the circuit clerk, the presiding judge, the other three judges, the court administrator and two supervisors (one for the civil division and one from the criminal division) and other courthouse employees since the audit. OSCA recognized that significant improvements have been made to internal controls since the audit. The improvements include, but are not limited to, the following: the use of manual receipts has been significantly reduced. Supervisors ensure that manual receipts are recorded in JIS. The supervisors no longer receipt monies. Non-monetary receipts now require documentation including court orders issued by the judges and the transactions are reviewed by supervisors. Only supervisors are allowed to void and retake receipts from cashier sessions. OSCA further noted that the Court has developed a written policy for receipting money and enacted “very good” accounting guidelines.

Ms. Umstattd had planned to continue to implement more detailed review of the accounting guidelines and had planned to continue to focus on internal controls including further supervisory review. However, the working environment at the courthouse has become increasingly tumultuous leading Ms. Umstattd to resign her position rather than continue to work in a hostile environment."

Hamblin also released a statement from Umstattd.

"I want to thank my family, friends, constituents and the citizens of Cole County for their support," she said. "This support has meant a great deal to me during the past ten years and through two contested elections. There have been many changes at the courthouse during my tenure. With these changes, as well as health related issues affecting my family, I have decided it is time to move on with the next phase in my life. It has been my pleasure to serve you. Thank you all for the wonderful memories and experiences, which you have given me during my service as your Circuit Clerk.”

In a press release from Judge Joyce's office, Joyce said that Umstattd's resignation is effective immediately and Gov. Nixon will name a successor.

Until a successor is named, Joyce will act as appointing authority for the Circuit Clerk.

"The state auditor's report is very serious and reflects numerous deficiencies in the operation of the clerk's office," Joyce said in a press release. "The poor fiscal management of the circuit clerk's office and lack of adequate financial controls has placed at risk hundred of thousands of dollars that pass through the office every year. Over the next several months, resources from the office of the state's court administration will be available for training of all clerks. The circuit clerk's office will focus on proper accounting for all funds that are entrusted to the clerk by the court. An additional review will be conducted by the state auditor. After the follow-up review, the court is confident that citizens will be assured that all procedures are being followed for a true account of their funds."

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