Brookshire City officials directed staff to bring in outside financial expertise after the city finance officer reported an apparent discrepancy in bank transfers from Wells Fargo to NewFirst.

At the May 1 City Council meeting, Natalie Lyons, who identified herself as part of the city finance department, told council members she traced a year-end balance in a Wells Fargo tax account of $1,585,086.16 and could not reconcile a subsequent transfer into NewFirst accounts. Lyons said an estimated $1,100,000 that should have moved was “unaccounted for” in her preliminary review and that Wells Fargo returns were needed to complete verification.

The finance department requested help getting full transaction detail from Wells Fargo and flagged related collateralization notices the city received from BNY Mellon. Lyons told the council, “I cannot find this $1,100,000.00 at this time,” and said access to Wells Fargo statements and account administrators was limited because account control and signers had changed.

Mayor Pro Tem Richards and other council members pressed for rapid clarification. Councilmember McDade moved — and the council approved — a motion to engage an external agency with forensic accounting and banking expertise to assist the finance director in tracing transfers and reconciling accounts. The motion passed by voice vote; the meeting record did not show a roll-call tally.

City staff said the immediate next steps are: (1) restore authorized access to Wells Fargo statement history and account detail, (2) complete internal reconciliation, and (3) use the contracted expert to analyze collateralization reports and traces of the ACH and other transfers that completed around January 2024. Finance staff told council that some accounts and collateral reports from Wells Fargo and BNY Mellon show multi-million-dollar figures that require explanation, and that delay or missing audits had already held up grant reimbursements.

Council members said the review must be transparent and, if criminal activity is indicated, that results should be referred to the appropriate prosecutorial agency. Council did not direct immediate criminal referral; members said staff should report back with findings and recommendations before any referral.

Why it matters: City bank transfers and reconciliations are central to budgeting, audit readiness and grant reimbursement. Council members repeatedly said they wanted a precise accounting record and full documentation to protect the city’s assets and enable pending grant draws.

What’s next: City staff will continue to press Wells Fargo for account-history access, complete additional reconciling steps, and coordinate with the forensic accounting firm the council authorized. Council will review the firm’s findings at a future meeting.