While Northern New Mexico College officials were raising tuition and cutting programs in an effort to save money, a Business Office employee was reportedly helping themself to a couple hundred-thousand dollars of taxpayer money.
New Mexico State Police investigators are looking into how an unidentified senior-level Northern New Mexico College employee walked off with approximately $200,000. They have been investigating the case since March 1, when the New Mexico State Auditor’s Office referred it to them.
Independent auditors, from Albuquerque-based Jaramillo Accounting Group, discovered something was amiss with the institution’s finances during the review of Northern’s books, as part of the state-mandated annual audit. Besides the missing money, auditors also learned that for some unknown reason, finance officials reportedly failed to deposit checks made out to Northern. The Office didn’t provide a dollar amount for those checks.
State Auditor Deputy Chief of Staff Justine Freeman said her Office discovered the theft, which occurred sometime in 2012 and 2013, after asking the accounting firm handling Northern’s 2016 audit, to look deeper into their finances. The Office made the request after fielding concerns and complaints from undisclosed sources.
“This year, we instructed the College’s independent auditor to dig a little deeper due to concerns that were raised,” she said. “The auditor began asking more questions and requesting further documentation, leading the employee to come forward.”
However, she wouldn’t elaborate on those concerns.
It is unclear who the employee is, because neither Freeman nor Northern’s President Rick Bailey would reveal the employee’s identity.
However, former Finance director Henrietta Trujillo abruptly resigned Feb. 28, a couple days before the Office’s March 1 press release about the theft, was made public. Trujillo worked at Northern for approximately seven years.
Bailey said his comments are limited because he doesn’t want to jeopardize the investigation, which is in the early stages.
He said the institution is working on strengthening its accountability measures and that should make it much more difficult for someone to engage in future wrongdoings.
“I am confident that we are putting controls in place, and have put controls in place, to prevent future challenges,” Bailey said.
Freeman attributes the uncovering of the theft to her Office’s ability to direct the independent auditor to look for certain things. However, Bailey believes the progress the institution has made in recent years made it easier to discover those irregularities.
Specifically, he said Northern officials have worked diligently to stay on top of the institution’s financial responsibilities and improve its business practices, and that went a long way toward making it possible to detect the crime.
“The College has made great strides over the past couple of years,” he said. “And, I am convinced that if we hadn’t made those strides, this revelation wouldn’t have come to light.”
Northern Vice President of Finance and Administration, Domingo Sanchez, who is ultimately responsible for the institution’s finances, said since the reported theft is still under investigation, he can’t comment on why it went undetected for so long.
A review of Northern’s disbursements for Fiscal Years 2014, 2015 and 2016, show finance officials made out checks to petty cash for as much as $17,000. In all, the petty cash checks totaled more than $89,000.
Sanchez said he doesn’t know the specifics involving those particular checks, but said it is not all that unusual to make out such large checks to petty cash. He said such a disbursement could be used to supply cash to the bookstore during book buybacks.
Past audit findings
One of the reasons the reported crime probably went undetected is because Northern officials failed to properly balance its bank accounts.
Findings from Northern’s 2013 audit shows Finance Department officials routinely failed to properly control cash by reconciling or ensuring bank statements matched the general ledger.
The failure to timely reconcile the institution’s bank accounts was a repeated finding in the 2013, 2014 and 2015 audits.
This failure resulted in what is commonly referred to as a material weakness. A material weakness is a deficiency that could result in errors not being prevented or detected in a timely manner. The alleged theft dates back nearly five years, which means more missing money could be detected.
Trujillo couldn’t be reached for comment, but court records show Wilmington Savings Fund Society foreclosed on her and her husband, Jeremy Trujillo’s home, in January 2016. Apparently the couple fell behind on their more than $316,000 mortgage.
The couple was also sued by two different payday loan companies. A Santa Fe District Court judge awarded Marshall Recovery, LLC., $2,900, in May 2016, to settle a past due debt of $2,600, along with attorney fees. A Santa Fe Magistrate Court judge dismissed the other suit brought by Xpress Cash for Trujillo’s failure to pay $1,900 she owed the lender.
When Trujillo abruptly resigned, she walked away from an $85,000 annual salary, which is $10,000 more than the $75,000 she earned the prior year.
A couple weeks before the theft became public, the Office placed Northern on its annual watch list for failing to complete its Fiscal Year 2016 audit by the Nov. 17, 2016 deadline.
State Police Public Information Officer Sgt. Chad Pierce said the investigation is in its early stages.
“We are actively investigating the matter,” Pierce wrote in a Monday email. “No suspect has been named and no reports have been filed at this time.”