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Sullivan County treasurer reports drop in sales tax receipts and rising check fraud
Summary
County Treasurer Nancy reported a recent downturn in sales tax receipts and a surge of check fraud affecting multiple county accounts; staff are expanding bank fraud protections and exploring ACH for payments.
Sullivan County Treasurer Nancy (last name not specified) told the Management and Budget Committee that sales tax receipts are down and the county has experienced multiple incidents of check fraud across several accounts.
Nancy said the county reviewed a state website projection that showed sales tax down by $55,000 and that the top-line decrease from prior reporting makes the shortfall closer to $100,000. "It's down $55,000, but, hopefully, that's gonna turn around at some point," she said.
The treasurer gave detailed examples of check fraud dating to 2022. She said an initial incident in 2022 involved about $22,000; in 2023 the county had a $57,000 loss charged to the general fund and several other check- and ACH-related incidents. In recent weeks she reported a spike of cases: multiple accounts including the DFS account, payroll, mortgage tax, general fund and county health have been targeted. "In the last couple of weeks, we've had in [the] DFS account, 18 of them. We're getting, like, 4 a day," she said.
Nancy described how fraudsters alter payee names, dollar amounts or bank routing information — sometimes producing forged copies that are difficult to distinguish from genuine checks. A recent case she flagged involved a changed vendor name on a $5,000 check; she also said the county has seen a cumulative exposure she summarized as "214,000 with a fraudulent jack" in recent activity.
County staff are pursuing multiple protections. Nancy said the county uses "positive pay" on many accounts and has pushed banks that previously lacked that protection to adopt it. "We're trying — I just sent a KeyBank today — any accounts that we don't have on positive pay, we want them on positive pay," she said. The treasurer said banks have reimbursed the county so far and that staff are investigating broader use of ACH, starting with payroll-related vendors, though implementation will be phased.
Committee member Louie Alvarez and others asked whether automatic deposits could replace check payments for frequent vendors; Nancy said the county is exploring ACH but cautioned rollout requires coordination with payroll and audit processes. She also credited accounting staff for compiling the incident history and noted the county coordinates with banks and law enforcement when fraud occurs.
The committee did not take a formal vote on new authority or funding at the meeting; Nancy said staff will continue to expand positive-pay protections and review ACH implementation for high-use payees.
Less urgent budget matters and other county reports followed.
