Federal, state, and local law enforcement agencies are investigating a former Haileyville city employee following the discovery of inaccuracies in the city’s finances.
Haileyville City Attorney Jeff Herrick said an investigation was opened into the city’s finances after former financial clerk Rayna Holt allegedly forged and cashed four checks belonging to the city in December.
An affidavit filed in Latimer County District Court alleged Holt cashed a total amount of $2,262.60 worth of checks over a two-day period at a Wilburton grocery store and ran from the store after employees declined to cash a fifth check.
Documents show Holt was charged Jan. 13 with one felony count of uttering a forged instrument and faces up to two years in the custody of the Oklahoma Department of Corrections or up to one year in the Latimer County Jail and/or a fine not to exceed $1,000 if convicted of the charge.
“There’s a complete investigation ongoing,” Herrick said Tuesday. “We immediately contacted the Oklahoma State Bureau of Investigation the first day.”
Herrick said the agency suggested the FBI assist in the investigation.
In city council meeting minutes obtained by the News-Capital through the Oklahoma Open Records Act, Haileyville Mayor David Johnston notified city councilors during a Jan. 2 special meeting of the alleged misappropriated monies.
The minutes state Johnston told councilors that the city received a phone call from a grocery store in Wilburton about “four checks were trying to be cashed and the signatures did not look legit. They sent us a fax of the checks and we discovered two of the signatures were a forgery. Looking further into the financials, it was discovered that several PayPal, Venmo, and other transfers had been made.”
Minutes from the meeting show councilors voted to close and open new bank accounts for the city of Haileyville.
A letter dated Jan. 22 states Holt's employment was terminated Jan. 2 "for the good of the service" and the decision was not reversible. The McAlester News-Capital submitted an Open Records Act request on Jan. 16.
During the Jan. 13 regular city council meeting, Johnston told councilors new bank accounts were opened and that “there will not be any online banking allowed during this administration.”
Mike Kerns, a certified accountant, reported to councilors what he called “a difficult situation” and said he would be performing accounting procedures for July-December 2019. “Anything he finds questionable will be put into a general ledger named questionable costs,” according to the minutes.
“So far this started in September with a few questionable transactions totaled at approximately $10,000. October has between approximately $10,000 to $15,000. November had a few transactions but in December there were multiple questionable transactions,” the minutes state. “Mike Kerns will be working with the OSBI on his findings.”
During the Feb. 11 meeting, minutes show Johnston accepted the resignation of Vicki Allen from the city council so she could start as the new finance clerk Feb. 12.
Herrick said Haileyville residents should commend their city government for acting swiftly.
“The people of Haileyville should be very proud of their government,” Herrick said. “Action was taken immediately upon receiving notice. They are very well setup for this because they have so much law enforcement background in their city government.
“You have people here that knew exactly how to respond; even in a moment of shock, they knew how to respond,” Herrick said.
Contact Derrick James at firstname.lastname@example.org