HUBBARD Investing losses lead to changes

An internal audit is being called successful. An external audit by a CPA is next.
By TIM YOVICH
VINDICATOR TRUMBULL STAFF
HUBBARD -- A change has been made in the way the Hubbard Community Fund invests its money since the charity lost some $50,000 in the stock market.
Meanwhile, board members have called for a complete audit of the organization's finances.
Board member Dan Modak made the motion seeking the audit at a recent board meeting.
James Kerrigan, secretary-treasurer, invested $125,000 from the fund's treasury in the stock market. The investments lost $52,000, said two board members.
Anthony Ponzio, a board member since the 1960s, confirmed that the loss was incurred by investing in stocks.
No criminal wrongdoing: It is unclear what period of time the investments cover or what stocks were purchased, but fund officials say there has been no indication of criminal wrongdoing.
Tim Kyle, board vice president, said Kerrigan had the authority under the organization's bylaws to invest as he saw fit.
That's been changed.
Investment decisions now must be approved by the budget committee before changes are made, two board members said.
Kyle and other board members would not discuss the issue further, referring other questions to fund president Norma Masluk.
About audits: Masluk said in a prepared statement that an internal audit was completed "and it proved to be successful."
She said an external audit will be done by a certified public accountant.
The statement made no mention of fund investments, and Masluk said she wouldn't comment further.
Kerrigan, a Hubbard Board of Education member, did not return messages left at his office.
The fund was able to accumulate the $125,000 through substantial interest rates in the 1980s from conservative investments such as certificates of deposit, one board member explained.
The board member said all funds are accounted for -- the purchase price of the stocks has been verified with the broker and compared with current values.
The community fund receives about $12,000 annually from the United Way of Youngstown/Mahoning Valley.
What it's for: The money is used for emergency relief and medical assistance, according to Larry Moliterno, director of planning and community development for the United Way.
"We have not had any problem nor have we heard of any problems" with the Hubbard fund, Moliterno said.
The money that was invested came from other sources and is separate from the United Way allocation.
Ponzio said the treasury has been accumulating "because it hasn't been used that much," noting it was used in the aftermath of the 1985 tornado that struck the area.
yovich@vindy.com