The attorney general for Indiana has filed suit against the former treasurer of a volunteer fire department to recover not only the $185,000 in department funds he is accused of misappropriating plus $50,000 in additional costs the department incurred, but a statutory damage award of three times the fire department’s actual damages for a total of $575,000, plus interest, costs and attorneys’ fees.
Indiana Attorney General Curtis T. Hill, Jr. filed the suit yesterday in Hamilton County Superior Court against as the former treasurer of the Wayne Township Volunteer Fire Department, Norman Burgess. Burgess was indicted earlier this year on federal wire fraud charges. For point of clarity because there are several Wayne Townships in Indiana, this Wayne Township is in Hamilton County. Here is a copy of the six-count indictment: USA v Burgess
The two-count lawsuit filed by AG Hill includes one count of restitution and one count based on Indiana Code §34-24-3-1 that allows treble (triple) damages to be awarded to crime victims in Indiana. The fire department first discovered some financial irregularities in August, 2016. Burgess, who had been with the fire department since 2008, resigned in October, 2016.
From the complaint:
- Defendant Norman Burgess was the Treasurer for WTVF at all relevant times during the Audit Period.
- The Audit Report disclosed malfeasance, misfeasance, and/or nonfeasance on the part of Burgess, and was placed by the State Examiner on May 25, 2018, with the Attorney General, pursuant to Ind. Code §5-1 1-5-l(a).
- The Audit Report also disclosed that public funds, which the State seeks to recover upon this Complaint, were either:
- misappropriated, diverted, or unaccounted;
- illegally received;
- illegally retained;
- unaccounted for or monies received and not paid over;
- obtained by fraud or in any unlawful manner; and/or
- wrongfully withheld from the public treasury.
- Defendant is either a delinquent officer, sureties of the officer, or any other proper persons against whom recovery of such misappropriated, diverted, or unaccounted for funds may be had, pursuant to Ind. Code §5-1 1-5-1.
- During the Audit Period, Burgess received unauthorized payments from WTVF in 112 instances, totaling $59,656.49, and without any supporting documentation.
- For an additional 226 instances during the Audit Period, Burgess initiated unauthorized cash withdrawals totaling $71,133.70.
- Of these 226 withdrawals, Burgess used WTVF credit cards for 218 unauthorized cash withdrawals from ATM machines, issued and endorsed 4 unauthorized checks made payable to “Cash”, and made 4 cash withdrawals through checking account withdrawal forms submitted to the bank.
- Additionally during the Audit Period, Burgess issued and endorsed eight unauthorized checks totaling $2,708.47 paid to the order of “Cash” and “Petty Cash,” and without any supporting documentation to validate the payments.
- On July 13, 2015, Burgess issued and endorsed a check in the amount of $1,500.00 from WTVF funds, made payable to “Cash” and noted “Village [sic] Fair (Lapel)” in the check’s memo line.
- However, during SBOA’s examination of WTVF, the Treasurer of Lapel Community Association indicated that the Association had not received the $1,500.00.
- A review of Burgess’ personal bank account revealed a $1,500.00 cash deposit on the same day he issued and endorsed the foregoing check, on July 13, 2015.
- On February 20, 2014, the Wayne Township Trustee issued a check to the Department in the amount of $5,074.00, but ‘the deposit ticket, signed by Burgess, noted a “less cash received” amount of $1,250.00, making the net deposit $3,824.00.
- In addition, Burgess used WTVF debit cards issued for unauthorized personal purchases totaling $48,299.22, including but not limited to: charges for funeral expenses; 251 charges at fuel/convenience stores; 126 charges for food purchases unaccredited to Department business; 104 charges at online retail merchants; and child support payments.
- Further, Burgess also caused the Department to incur 200 separate charges associated with overdraft fees, ATM fees, penalties, interest, and other charges, totaling $6,827.28
- Moreover, Burgess failed to timely remit federal and state payroll taxes between 2014 and 2016, resulting in WTVF paying unnecessary and excessive penalties and interest payments to the Internal Revenue Service (IRS), in the amount of $5,428.29.
- As a direct and proximate result of the breach of Burgess’s duty to WTVF, WTVF suffered a pecuniary loss in the amount of $196,803.45.
- As a direct and proximate result of the breach of Burgess’s duty to WTVF, SBOA incurred additional audit costs in the amount of $41,571 .60.
Here is a copy of the complaint: State of Indiana v Norman Burgess