29 Soulh Main Slreet -iel 860.561.4000

P.O.Box272000 Fax860.521.9241West Hartford, CT 06127-2000 blumshapiro.com

Blr-riiiShaprror,\r.'countir:g'l'ix lJusi nr:ss Consttl ti ug

April 15,2014

David Cassefti, MayorCity of Ansonia253 Main StreetAnsonia, CT 06401

Deal Mayor Cassetti,

Blum, Shapiro & Company, P.C, ("BlumShapiro") was engaged by tlre Ciry of Ansonia (the

"City"), through the Office of the Generat Counsel, to provide forensio acoounting services in

order to assist in its investigation of the Office of the Town & City Clerk (the "Office").

Blumshapiro was asked to exarnine and analyze transactions including deposits, withdrawals,

checks, wire kansfers and ACH transfers in bank statements for an account held in the name of

the Cify of Ansonia - Town & City Clerk ("City Clerk Bank Account") I for a period extending

back at least i 4 years from December 31,2013. Blumshapiro was also asked to analyze and

quantify oompensation paid to the Town & City Clerk (the "Clerk") and Assistant Town & City

Clerks ('Assistant Clerks") forthe same period-

Baekground

Conneqlicut Genera!$tatutes

Conneoticut Ceneral Statutes, Chapter 92 (Town Clerks), Section 7-34a. Fees, sets forth in detail

the method of compensating town clerks based on fees collected, The statute Iists specific

dollar amounts of compensation to town clerks based on specific tasks undefiaken by town

clerks. The Statute also states:

I The City Clerk Bank Account was maintained at First Union from july 1999 through May 2003. The June 2003

bankstatententwasunavailable. FrornJuly2003throughApril l5,20ll,theaccountwasnraintainedatWachovia.From April I 6, 201 1 through Decernber 201 3, tho account has been maintained ai Wells Fargo.

Blurn, Shapiro & Company, P.C,

Page IAn independonl mamber of EakerTilly lntemational

"Corupensation for all services other than lhose eruunerated in sttbsectian (a) of this

section which totvrt clerks are reEired by the general statutes to petform and tot which

contpensation is notfixed by statute shall be fixed and paid by the selectnzen or other

goventing body of the tor4,n ff cily in which such setilces are performed."

Fu$hennore, Connecticut General Statutes, Chapter 92 (Town Clerks), Section i-34b. $(b)

states:

"Any town ntay, by ot'dinance, provide that the tovtn clerk sltall receive a salaty in lieu of

allfees and other contpensation providedfor in the general slalutes, u,hich salaty shall

be fixed by the legislative body of such town. Upon the adoption of such ot'dinance the

fees or contpensation provided by the general statules lo be paid to the toum clerk shall

be collected by such toy'n clerk and he shall deposit all such ffioney collected by him in

accordance with such p'oyisions of law as govern the deposit of maneys belonging lo

such lov,n,"

Qity of Ansppiq

Historically, the City has authorized a salary to be paid to the Clerk and Assistant Clerks. On

March 13, 2001, the City adopted a resolution (the "Resolution") to increase the salaries and

wages for the Clerk which was to become effective beginning Decemlrer 1, 2001. Exhibit I

displays the annual salary for the Clerk before and after the Resolution was adopted by the City,

The Clerk maintains and controls the City Clerk Bank Account, into which fees collected by the

Office are deposited. Histolically, a portion of such fees have been used by the Office to pay

additional compensation to the Clerk and Assistant Clerks by transferring funds from the City

Clerk Bank Account to the City's payroll account on a regular basis. As of December 31, 2013,

the balarrce in the City Clerk Bank Account was $277,676.

Madeleine Bottone ("lvIs. Bottone") held the office of Town & City Clerk from March 4,lgg7

throughDecember3l,20l3. UponherretirementinDecember20l3,Ms,Bottoneinformedthe

City that she considered the fees that had accumulated in the City Clerk Bank Account over the

yeals to be her propefty, representing her rotirement funds.

8lum, Shapko & Contpany, P.C.

Page 2

An independenl member of Saker Tilly hlerna$onal

4nalysis Pellorlnel!

Blumshapiro analyzed transaotion activity and quantified the amount of money deposited to and

disbursed frorn the City Clerk Bank Account. Bank statements for the City Clerk Bank Account

were available from JLrly i 999 through December 2013. The City was unable to looate or oblain

copies of bank statements for periods prior to July 1999. BlunrShapiro analyzed all banlc

activity, including deposits and disburiements, from July i 999 through December 201 3.

Staternents for the months of December 2001, January 2002 and June 2003 could not be located.

For these three rnonths, BlumShapiro oaiculated the nat increase in the City Clerk Bank Account

(beginning balance of the next available bank statement Iess ending balance of the previous

available bank statement), which totaled $19,133. Therefore, the detail ofthe transactions for

these three months is not lncluded in this analysis.

Based on the available bank statements, from July I999 through December 2013, there was a

totai of $4,5 37 ,042 deposited and $4,259,367 disbursed from the account, for an ending

December 31,2013 bank balance af $2'17,676.

Of the $4,259,367 disbursed, $1,933,905 was remitted to the City, $i,286,468 to the City's

payroll account, $826,082 to the State of Connecticut Treasutet, $109,244 to the City for the

purchase of computers, $86,416 to the Commissioner of the Depafiment of Environmental

Protection and $17,252 to others, as set forth on Exhibit 2, which is a summary of all transactions

during the period, totaled by payee.

BlurnShapiro requested copies of any and allreports detailing the method by wlrich additional

compensation and/or the amounts transferred to the City payroll aooounl were calculated' No

such reports could be located. Therefore, Blumshapiro estirnated the amounts of additional

compensation paid to the Clerk and Assistant Clerks as set forth based ott available salary

information.

Blum, Shapiro & Company, P.C.

Page 3Afl independefl I m€mber ol Baker lilly lnteraalional

Ml Botlone

From 19992 through 2013, Ms. Bottone received base salary and additional compensation as

outlined in the follorving table:

Year

r999

20m

2001

2W22003

2W4

200s

2006

2W7

2008

2009

2010

2011

201?

2013

Total

Additional TotalW-2

Base salary compensation wages

S 1qs8o $ s1,838 $ 66,418

S rs,746 $ s:"sqs S 67,297

s u,ooe 5 s4:sz 5 zt,Egs

s t8,grz s 54,722 s 73,039

S zo,43o $ 52,058 5 zaqea

$ z2,o6s $ 50,280 $ 72,345

$ 23,830 $ SO,Srq $ ru,zu5 25,737 $ Sr,eSZ $ 77,389

$ 27,796 s 51,420 $ 79,2L6

$ 27,796 S so,o+r $ 78,437

$ 27,796 $ 49,356 $ ll,tsz5 27,796 S 48,777 $ 76,573

$ zllge S 48,967 $ 76,763

5 27,796 5 +8,qSZ $ 76,253

5 ztJga $ ql,qts S 75,271

s 3528S3 $ Zet,ggg $1,t14,716_

Ms. Bottone's addilional compensation was calculated as the difference between her W-2 wages

and her base salary, as outlined in the Resolution @xhibit I ).

3 According to the City, Ms. Botlone assunred the Torvn & City Clerk position mid'term, otr March 4, 1997.

Blum, Shapiro & Company, P.C.

Page 4An independant membaof Baker Tilly Inlernalional

Lindu Yan Valkenburgh

Frorn March 4,1997 through March 5,20i0, Linda Van Valkenburgh ("Ms. Van Valkenburgh")

served as Assistant Town & City Clerk. From 19993 tlirough 20l0, Ms. Van Valkenburgh

received base salary and additional compensation as outlined in the following table:

Additional Totalw-2Base salary compensation wages

$ $,986 S 32,871 S qg,asz

$ 17,375 s 32,129 s 49,505

s 18,887 $ S4Sar $ 53,468

$ 20,529 $ 38,504 s S9,Ogg

$ 20,529 $ 4q140 $ oo,E69

$ zo,sza $ 43,793 $ 64,b21

$ 22,718 s 43,596 s 66,314

$ 23,133 $ qo,aos $ 64,001

$ 24$6 $ 43,302 $ 52458

$ z4ssr S 40,873 $ 05,754

$ 25,248 $ 40,s87 $ 51335

$ 4370 $ 1es2s $ 16,895

S 238,639 5 a+s,ttt SGs2,41o

Ms. Van Valkenburgh's additional compensation was calculated as the difference between her

W'2 wages and her estimated base salary, as recalculated using her bi-weekly pay rate.

Elizabeth Lltnch

From July 5,2010 through December3l,20l3, Elizabeth Lynch ("Ms. Lynoh") served as

Assistant Town & City C)erk. From 20i 0 through 2013, Ms. Lynch received base salary and

additionaI compensation as outlined in the follorving table:

Additional TotalW-2Base salary compensation wages

$ t2,672 5 zo,g6e $ $,638

s 26,005 $ 38,6+Z s 64,648

$ 26,526 5 4914s $ 65,SZr

$ zl,zzz 5 38,214 $ 65,436

S 92,426 $ uz,gsz Sxo,lgg

3 Records were not available for periods prior to July I 999.

Year

1999

2000

2001

2002

2003

z}u2005

2006

2007

2008

2009

2010

TOTAL

Year

2010

20tt2012

2013

TOTAL

Blum, Shapiro & Company, P,C,

Page 5An independent member of Bafter Tilly lntemational

Ms. Lynch's additional cornpensation was calculated as the difference between her W-2 wages

and tlre arnount of base salary, as provided by Ms' Lynch.

Suntmary

The total estimated additional compensation paid to the Clerk and Assistant Clerks based on

above tables was $ 1,343,63 I . The amount transferred to the City payroll accottnt was calculated

to be $1,286,468 from the available banlc staternents (see Exhibit 2). The difference of $57,163

is the estimated amount transferred to the City payroll account in the months of January through

June I999, December 2001, January 2002 and June 2003 for which bank statements were

runavailable.

Co-Bclusion

The Clerk had cornplete controi of the City Clerk Bank Account and was the only signatory

thereon. From at least July 1999 thror.rgh December 3 1, 2013, the Clerk and Assistant Clerks

were compelsated through a hybrid system which inoluded salary, as authorized by the City and

additional compensation paid from funds accumulated in the City Clerk Bank Account. Funds

were transferred on a regular basis from the City Clerk Bank Account to the City payrol!

account. Such funds were then paid to tlre Clerk and Assistant Clerks and included in their

annual form W-2. The City could not provide documentation to Blumshapiro as to how the

additional cotnpensation was calculated.

Based on the analysis preformed, Other than funds transferred to the City's payroll account and

the $ 1 09,244 transfemed to the Cify for the purchase of computers, no trallsactions in the City

Clerk Bank Account appeared to be outside the normal coulse of business'

From the available bank statements, frorn July 1999 through December 2013, BlumShapiro

conoluded that deposits to the City Clerk Bank Account totaled 3+,537,A42 and disbursdments

totaied $4,259,367, for an ending bank balance of $277,676.

Bltrm, Shapiro E CompanY, P,C.

Page 6An independent member of BakerTilly lntemational

As detailed in this report, BlumShapiro estirnates that the following employees in the Office of

the Torvn & City Clerk were paid additional compensation fi'om the City Clerk Bank Account

between 1999 and 2013:

Madeleine Bottone4 $761,893

Linda Van Valkenburght S4+3,771

Elizabeth LYncha $137967

Total $1,343,631

Rieht to Amend-Report

Blumshapiro reserves the right to amend this report if additional information or docurnentation

comes to our attention or is presented to us that might further support, supplement or otherwise

ohange any faots or opinions expressed herein.

Dated at West IJartford, Connecticut this 1 5th day of April, 2014

CFF, CFE, CIRAPartner

4 I 999 through 201 3

5 't999 through 20106

20 l0 rhrough 2013

Blum, Shapito & Company. P.C.

PageTAn ifldependent member ol Baker li[y Internatonal

ffixhBtuBtr g

RT"SOIUTTON

r(arhleen c.8.-samela oitu nf ^ftnrnnig .Altleruen Ralphine S. Ford

' gA 415u Salary cornmitte,e . . . -ffid, inkoducedihe following Resolution:

Heolveil,rum; There salaries and, wages be ad,opEed. effeclive December 1, 200r:

The salary for Town and City Cle*, serving conseeutive terms:

TERM

lsi year ofterm

2nd year oftem:

3rd year ofterm

4th year ofterm

5th yaar oftenn6th year ofterm

7th year ofterm

8th year of tenn

9th year of term

lOihyem oftercr

CURRENT NEW' 13500 13905

14580 i5017

15746 .i6218i?006 17516

18366 18917

19835 20430

21422 22065

23136 23830

24987 25737

26986 n796

hl&&i;t/ J.oru'

UY/UI l"t &J l'"'"1'r^g'*

{*$ a::sb- $*" i

'?0 b-l ,

Ailopted Harch 13 , 2001

W**tt'.il,,,6fr*-,"*City Clerk

ffixh6h$tr m

Exhibit 2

Citv of Ansonia

City Cterk Bank Account (First Union/Wachovia/Wells rrgo)

Transactions Summarized bv Name

tuly 1999 - December 2013

Name Deposit Disbursement

Deposit Total s 4,5i.4,866.28 (_ .-'1,s27,00

N et Depos its_-*Sta te m en ts n_'ussin g Tg!11

Deposit correction Total__ 1e.1!3,0s

2,967.75

Check Printing Fee Refund Total 75.00

City of Ansonia Total 1,933,904.83

CiW of Ansonia Pavroll Account Total 1,286,468.22

Treasurer State of Conn Total 825,082.10

Citv of Ansonia - Computer Purchase Total 109,244.00

Commissioner, Dept of Env Protection Total 86,415.50

Conn Town Clerk's Assoc Total 5,896.00

Bank Adiustment Total 2,478.86

Returned ltem Total 1,480.75

New Haven County Clerks Assoc Total 1,402,00

Secretarv ofthe State Total 780,00

Automated Debit Deluxe Check Co Total 605.87

BANK FEES TOTAI 531.34

PAUIA RAY TOTAI 200.00

New Ensland Assoc of City Town Clerks Total 150.00

Sarah Becker, Old SaybrookTown ClerkTotal 150.00

DerbvTown ClerkTotal 128,00

Sophie K Morton, Town Clerk Total 120.00

Danburv Town clerk Total 108.00

Records Admin Total 106,00

Anne Moses.llgg;yrgrr.cT!e Tgtal " - -._

Alan Jepson, Town Clerk Total

lQ-0.90

96.00

Wallinsford Town Clerk Total 93.00

Meriden Town Clerk Total 88.00

Wachovia Total .

cheshire Town Clerk Total_ 8_5:00

83.00

Radian ExpressTotal 83.00

Household Finance Corp. Total 55.00

Guilford Town Clerk Total 61.00

Stuhlman & Dombrowski Total 60.00

Wells Fargo Home Mortgage, lnc. Total 44.00

Hartford TotalSh-ltr" Tr*" cl"rk T"t.

i 43.00F_=.---_.-*-| 43.0.0

US RecordingTotal 43.00

Ufetouch National School Studios Total 40.00

Waterburv lown Clerk Total 38.00

Stephanie Ciarleglio, Woodbridge T'C' Totat 37.00

LXntDrt I

City of AnsoniaCity Clerk Sank Account {First Union/Wachovia/Wells Fargo)

i'ransactions Summarized by Nameluly 1999 - December 2013

Name Deposit Disbursement

UPS Total 33.15

Barbara Moore, Derby Town Clerk Total 31.00

Group G lnc, Recording Total 30.00

Esther Rozurn, Seymour Town Clerk Total 28.00

Margret Potts, Town Clerk Total 26.00

Town Clerk, East Granby Total 23,00

Ester Friedman Total 20.00

Peelle Corporation Total 18.00

Stafford Springs Town Clerk Total 18.00

Town Clerk, Sevmour Total 18.00

Virtual BankTotal 18.00

Attornev Edward Audroskl Total 15.00

ames E. Hart Total 15.00

Sxford Town Clerk Total 15.00

First Union National BankTotal 13.00

Georgette Laske, Branford Town ClerkTotal 13.00

New Haven Town Clerk Total 13.00

New London Town Clerk Total 13.00

RBMG lnc. Total 13.00

Sette & Bonadies, P.C.Total 13.00

Southington Town Clerk Total 13.00

Iown Clerk, Hartford Total 13.00y'era Morrison, Town Clerk Total 13.00

Ana Gonzalez CruzTotal 10.00

ELAINE POULIN Total 10.00

Fifth Third Bank Total 10.00

Robin L. clark Total 10.00

UERONICA K0ENIG Total 10.00

Comm of Revenue Services Total 5.00

Wemse Moore Total 5.00

Keith Shaw TotalGrand Total $ 4,s37,a4z. $ 4,259,367

Ending Balance $ ?,77,676