PORT ANGELES — It was all about the money Tuesday at the Port Angeles Business Association’s breakfast meeting.
The alleged embezzlement of at least $617,467 from the Clallam County Treasurer’s Office by former Cashier Catherine Betts dominated the Nov. 2 general election forum between incumbent Treasurer Judy Scott and challenger Selinda Barkhuis.
In their first debate, Barkhuis, 48, a county Department of Community development planner, said Scott, 59, a five-year incumbent, was a poor monitor of public funds.
She said Scott displayed an “inability to manage” the Treasurer’s Office during the period of at least five years ending in May 2009 when Betts allegedly stole $617,467 cash from the office’s cash drawer.
Betts faces a Jan. 10, 2011, trial in county Superior Court on a charge of aggravated felony first-degree theft and could be sentenced to more than 10 years in prison.
Betts allegedly altered and destroyed real estate excise tax records to hide the thefts, stealing an average of $10,000 a month between when Scott took office in January 2005 and when the theft was discovered, Barkhuis said.
“I know the law, I know office management and I know how to smell a rat,” Barkhuis said.
“I want to see confidence restored in the Clallam County Treasurer’s Office.”
Scott, a recent recipient of a state Finance Officers Association award for the 10th year, portrayed herself as embattled but standing firm.
“I am here to tell you I am a viable candidate,” she said, criticizing “‘coulda’, woulda’, shoulda’ armchair accountants with 20-20 hindsight.”
Scott sought empathy from the approximately 30 people in attendance.
“As business people, perhaps you have had someone steal from your establishment,” she said.
“Just like you, we have learned to continually review procedures and tighten policies,” Scott continued.
“I don’t know that you will ever be able to eliminate fraud unless you find a way to control human behavior.”
Betts was in charge of both recording transactions and making deposits from the cash drawer, a dual duty that has since been split up among office personnel whose work is reviewed daily to ensure accuracy and honesty, Scott said.
Scott’s staff discovered an initial theft of $1,200 May 19, 2009 in real estate excise tax proceeds that mushroomed into the fifth largest theft of public funds from a county agency in Washington state in the last decade
It led to a $60,067, nine-month state Auditor’s Office investigation that determined at least $617,467 was stolen between Feb. 1, 2004 and May 19, 2009,
“The county did not monitor this activity, enabling [Betts] to manipulate transactions and misappropriate funds,” agency investigator Jim Brittain said.
He concluded the thefts could have begun in 2003, when Betts became the office cashier and Scott was the deputy treasurer.
“The actual amount of the loss cannot be determined,” Brittain concluded.
Betts has pleaded not guilty, but authorities have said she confessed to stealing $1,300, which is misdemeanor theft.
Meanwhile Scott, who won election to her first full term unopposed in 2006, faces an election fight for another four-year term.
Barkhuis said Scott should have discovered that cash was being stolen after she was appointed treasurer by county commissioners for the retiring Ruth Gerdon and took office in 2005.
Dividing Betts’ duties among at least two employees was “the first thing that should have happened in 2005,” Barkhuis said.
“That’s why fraud continued for 53 months at $10,000 a month.”
Scott said duties were segregated in her office when the thefts occurred, but that Betts “found a way to manipulate” the processing of real estate excise taxes.
Barkhuis also said Scott should have double-checked her records with those of other county offices that had receipts of the transactions Betts allegedly manipulated.
Barkhuis, a licensed lawyer, said she is a former Realtor, was an H&R Block tax preparer, has managed a law office and took accounting courses in college.
Scott has worked in the Treasurer’s Office for 27 years.
“I’m not an accountant, but rather an administrator,” Scott said, adding she has an accountant on the Treasurer’s Office staff.
“I have learned my administrative skills mainly through pragmatic experience with the office and with opportunities of continued education.”
Scott said her greatest weakness is “trusting people sometimes.”
She said her greatest strength is her staff.
Barkhuis’ greatest weakness is being “a control freak” who has difficulty delegating duties, she said.
She said her greatest strength is “real-world experience” and knowing what “fiduciary duty” means.
Scott and Barkhuis were the only two candidates to file for the position.
If Scott wins, her salary beginning in January will be $70,872.
If Barkhuis wins, her salary will be $64,212.
County officials have said they expect the $617,467 to be covered by insurance.
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Senior Staff Writer Paul Gottlieb can be reached at 360-417-3536 or at paul.gottlieb@peninsuladailynews.com.
