PORT ANGELES — Clallam County has been offered a $597,516 insurance settlement to cover most of its losses from a former employee’s alleged embezzlement, Treasurer Judy Scott said Thursday.
That calculates to 96.8 percent of the amount of real estate excise tax that a state Auditor’s office investigation said could be proven to be missing.
“I’m just happy it’s coming to fruition,” said Scott, who is running for re-election in the Nov. 2 general election.
The three Clallam County commissioners on Monday will consider whether or not to authorize County Administrator Jim Jones to execute the settlement.
If approved, the county expects to receive the funds in 7-10 days.
“It’s in the works,” Scott said.
A state Auditor’s Office investigation concluded that a former treasurer’s office employee stole at least $617,467 in public funds from a county cash drawer over a five-year period.
Catherine Betts faces a Jan. 10 trial in Clallam County Superior Court on an aggravated first-degree theft charge.
An internal investigation by county accountant Jen Santos found that $611,485 had been taken between February 2004 and May 2009.
Great American Insurance Co. officials reviewed both investigations and accepted $607,516 of the sum.
The difference in the numbers stems from a lack of original source documents to prove that every alleged fraud transaction was fraudulent.
A $10,000 deductible brought the final settlement offer to $597,516.
“I think its a good settlement,” Scott said.
Immediately after receiving the fund, the county will wire the money — in full — to the various agencies where it should have gone in the first place.
“The deductible will come out of the county’s share of the money,” Jones said.
Scott and Jones agreed that Santos did a good job providing sufficient information to the insurance company.
“I thought we did well,” Scott said.
The embezzlement is the fifth-largest theft of public funds from a government agency in the state in the past decade.
The money has never been recovered.
Betts allegedly covered up a checks-for-cash fraud by altering and destroying real estate excise tax records, the state investigation found.
After pleading not guilty, Betts was released on her own recognizance and lives in Shelton.
As soon as the county receives the settlement, the revenues will be passed on to the state, the Clallam County capital projects fund and the cities of Port Angeles, Sequim and Forks.
The settlement breaks down as follows:
• $345,769 to the Clallam County capital projects fund.
• $199,387 to the state Department of Revenue.
• $34,304 to the city of Port Angeles.
• $13,271 to the city of Sequim.
• $4,640 to the city of Forks.
• $145 to the state for a technology fee.
Scott’s election opponent, Clallam County Senior Planner Selinda Barkhuis, has hammered on the embezzlement case during the campaign.
Barkhuis told Port Angeles Rotary Club members on Wednesday that Scott could have discovered the missing money within months of taking office in 2005 but didn’t, and that Scott had a “fiduciary duty” to safeguard public funds.
Barkhuis cited the $60,067 cost of the state investigation during the political forum.
Scott, however, said the cost was revised to $28,718 in April.
The commissioners’ work session on Monday will begin at 9 a.m. in Room 160 at the county courthouse, 223 E. Fourth St., Port Angeles.
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Reporter Rob Ollikainen can be reached at 360-417-3537 or at rob.ollikainen@peninsuladailynews.com.
