Forensic auditors tell Eagle Pass council key festival records are missing; firm recommends legal steps before final report

A forensic audit contractor told Eagle Pass City Council on April 1 that its review of the 57 South Music Festival remains incomplete because essential records are in the possession of the festival manager (identified in the audit as “Just 1 Management”), and the firm recommended legal steps to obtain those materials.

Randy (presenter) and a colleague identified several preliminary observations from the city-supplied records: bank and check-image data recently provided by the city are extensive (about 11,500 transactions under review), but the auditors said records held by Just 1 Management — including artist contracts, contractor agreements, unredacted bank statements, and bookkeeping detail — are still outstanding and necessary to verify large-ticket expenses.

“...we were brought in to review the expenses and the details surrounding the 57 South Music Festival,” the presenter said. The auditors noted the event manager was formed shortly before solicitation and that the manager received $1.3 million in advance payments before a fully executed city contract. Auditors reported discrepancies between vendor invoices and amounts invoiced to the city — examples on the slide set showed roughly $200,000 in differences across a sample of supplier charges.

Auditors also said the contract language, as drafted, favored the manager in several respects and that an addendum increasing the manager’s share of beverage revenues was executed shortly before the festival; they said they could not verify artist fees without artist contracts supplied by the manager. The presentation included a council-facing slide that showed projected ticket and sponsorship revenues near $4 million — figures auditors said they could not corroborate with the records available.

Auditors recommended the city seek further documentation from Just 1 Management (artist contracts, full bookkeeping records, unredacted bank statements, vendor correspondence and source documents for ticketing and sponsorship receipts) and suggested a demand letter referencing contract terms as a logical next step; they noted legal counsel should advise the city about remedies.

Councilmembers asked for legal options. Several council members proposed sending a demand letter; others urged counsel to outline remedies and next steps. No legal action against the manager was authorized during the meeting. Council ultimately asked the auditors and city counsel to pursue legal avenues and tabled further action pending counsel’s recommendation; the council did not accept a final forensic report at the meeting because of the missing materials.

The auditors said they have the city-provided records and will complete their report either as-is (with scope limitations documented) or after the city obtains additional records from the manager. The auditors did not assign criminal or civil liability in the presentation; their slides noted that determining intent or fraud would require the complete record set the manager controls.