PORT ANGELES — An insurance company representative who visited Clallam County Administrator Jim Jones and Treasurer Judy Scott last month left them empty-handed over the Catherine Betts embezzlement case, and they haven’t heard anything else since.
A status hearing on the aggravated first-degree-theft case against Betts, a former county Treasurer’s Office cashier accused of stealing $617,467, is at 1 p.m. Thursday in Superior Court in Port Angeles.
Jones and Scott said Monday that they had expected to find out during the July 27 visit with the insurance company when the county would receive a check for the stolen money, which they said is covered under the county’s insurance policy.
But Jones and Scott, who is running for re-election, were merely peppered with more questions about the case from the Great American Insurance Co. representative and the company’s forensic accountant, they said.
“He had us go over the whole thing again,” Scott recalled.
He and Scott received no indication if and when they would see any money, but Jones said he has “every reason to believe” the county will be reimbursed.
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.
The aggravated charge Betts faces allows a conviction above the standard maximum of 10 years in prison.
Jones and Scott said after the county is reimbursed, the revenues will be passed on to the state, the Clallam County capital projects fund and the cities of Port Angeles, Sequim and Forks — where they should have gone in the first place.
Scott said the county was due $346,968; the state, $211,898; the city of Port Angeles, $34,304; the city of Sequim, $$13,512, and the city of Forks, $4,640.
A nine-month Auditor’s Office investigation also concluded that the total amount of money stolen cannot be determined.
The county must pay $60,067 for the investigation and $6,000 for bank-related records, raising the total known cost to the public to $683,534.
“The county did not monitor this activity, enabling her to manipulate transactions and misappropriate funds,” state Auditor’s Office investigator Jim Brittain said.
Betts, who has pleaded not guilty, has been released on her own recognizance and lives in Shelton, Mason County.
She will not be tried until Jan. 10, after the Nov. 2 general election.
But Scott and county Senior Planner Selinda Barkhuis, a nonpracticing attorney who is challenging her, said the theft will be an election issue.
“Undoubtedly,” Scott said.
“I do not think I have to defend myself,” she said, adding she has created procedures to prevent what happened from happening again.
“We thought we had it covered,” Scott said.
“As soon as I was aware of the situation, I dealt with it, and I did everything according to the rules and regulations, above and beyond.”
But Scott should have discovered the theft as part of her “fiduciary duty,” Barkhuis said.
“That comes with a level of due diligence that I don’t think she showed,” Barkhuis added.
“She should have done more than she did.”
Betts allegedly stole the funds from February 2004 to May 2009 in a checks-for-cash scheme that went undiscovered by the Treasurer’s Office until anomalies were found in Betts’ bookkeeping May 19, 2009.
Betts admitted that day to stealing between $1,200 and $1,300, according to court documents, and was fired a month later.
Betts allegedly altered and destroyed public documents, manipulated computer-generated spreadsheets, created hidden documents on her computer that only she could access and concocted secret computer passwords the state Auditor’s Office could not crack during its investigation.
She is the only employee involved in the alleged scheme, Scott has said.
In June, Betts’ trial was moved back from July 12 to Jan. 10, 2011.
But her lawyer, Loren Oakley of the Clallam Public Defender’s Office, said the trial may be further delayed depending on the number of documents that must reviewed by his office.
“We’re just plodding our way through” case-related documents, Oakley said Monday.
Lawyer Harry Gasnick, also of the Public Defender’s Office, said 65,000 pages of documents must be reviewed and he expects more are coming.
“We just got CD number 14 or 15” from the state, Gasnick said Monday of the computer disks with data on them.
His office also may want to review the insurance company report whenever that comes out, he added.
“There’s a lot of stuff to go over,” Gasnick said.
He would not comment on how much the investigation has cost the public so far.
Jones said he is not aware of any bills for the case that have been submitted for payment.
Oakley said he would be open to discussing a plea deal that would make a trial a moot point.
Dan Sytman, spokesman for the state Attorney General’s Office, which is prosecuting the case, would not comment on a possible plea deal
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Senior Staff Writer Paul Gottlieb can be reached at 360-417-3536 or at paul.gottlieb@peninsuladailynews.com.
