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Neosho County commissioners seek forensic review after treasurer resignation and tax‑sale discrepancies
Summary
Commissioners called for outside review after the county auditor flagged unreconciled transfers and the City of Chanute reported $586,498.04 in special assessments not applied correctly at a Dec. 9 special meeting. Staff will produce attorney lists, pursue backups, and the board approved a legal representation letter to finalize audit work.
Neosho County commissioners opened a special meeting Dec. 9 to address unresolved items in the 2023 audit after the county treasurer resigned.
A commissioner told the board the county auditor identified multiple unreconciled transfers, saying, "the money's in the accounts, but improper transactions in the tune of about $2,000,000 back and forth, not into the right accounts." The same commissioner said the county received a call from the City of Chanute reporting that special assessments tied to a recent tax sale had not been applied correctly, totaling $586,498.04.
Gabby Sands, assistant treasurer and tax coordinator, described how the tax sale proceeds were distributed: the district court processed the sale and an attorney's office provided a distribution list that directed proceeds to general taxes, special assessments and penalties. Sands told commissioners the county applied funds according to the attorney's instructions and that Chanute supplied discharge paperwork for most affected properties, with one post‑sale special remaining the property owner's responsibility. She also acknowledged earlier handling errors by a prior staff member and said corrective work has been completed for most cases.
During public comment, buyer Bernard Nyer recounted purchasing a parcel at tax sale that showed roughly $600 in remaining special assessments and urged the board to address cases where assessments were reappearing on statements after sales.
Commissioners discussed whether the attorney received correct parcel‑level data from the treasurer's office and asked staff to obtain the exact list the attorney used. Citing the unresolved audit items and missed correspondence, one commissioner proposed a forensic audit of the treasurer's department "to protect the county," suggesting an initial one‑year scope that could expand if needed. Commissioners also discussed postponing the next tax sale until reconciliations are complete and the office transition is stabilized.
To protect evidence and ensure transaction histories, the board authorized IT backups of the treasurer office computers. The commission also approved a legal representation letter so outside auditors (mentioned in the meeting as Brett Haim and James Gordon Associates, CPA) can complete outstanding audit steps and related documentation.
Next steps include staff providing the attorney's distribution list, coordinating with Chanute to confirm the city’s intended abatements, identifying firms qualified to perform a forensic audit, and securing full computer backups and bank‑access records to support reconciliation and possible litigation.
The board approved related motions by voice vote and set follow‑up items for the next regular meeting.
