Tennessee's Comptroller's Division of Municipal Audit on Wednesday released more details about the investigation that led to the arrest of a former Winchester city finance director who is charged with stealing more than $150,000 from the town.
The former finance director, Mary Faye Morrow, 63, was arrested Tuesday on Franklin County grand jury indictments charging her with theft over $60,000, two counts of official misconduct, forgery and tampering with government records, authorities said. She was freed on $10,000 bond.
According to a news release from the comptroller's office, auditors and Tennessee Bureau of Investigation agents found Morrow "took many checks written to the city from the county court clerk for General Sessions and Circuit Court fines and fees to a nearby bank and converted them into cashier's checks and cash."
The cash never was deposited into a city bank account, and the cashier's checks later were swapped for additional cash amounts taken from other city accounts, Dennis Dycus, director of the Comptroller's Division of Municipal Audit, states in a letter to the city of Winchester.
Over a period of six-and-a-half years ending when Morrow retired in December 2010, the former finance director is accused of misappropriating more than $133,000 in checks from court fines and fees. An additional $19,000 in cash seizures from narcotics arrests was turned directly over to Morrow but never made it to the city's bank account, according to comptroller's office spokesman Blake Fontenay.
Investigators attribute the theft to the city's lack of separation of duties in the finance office where Morrow took city collections, opened the mail and prepared bank deposits, Fontenay states in the release.
"As a result, she was able to perpetrate check-cashing and check-swapping schemes," he states. Auditors recommended distributing those duties among more than one person.
"It is disappointing when people abuse positions of public trust," state Comptroller Justin P. Wilson said. "It's true at any time, but particularly during difficult economic times, local governments cannot afford to lose public funds to fraud, waste or abuse."
Officials urge anyone with information that fraud, waste or abuse is happening in local government to call the comptroller's office hotline at 800-232-5454.