LAWRENCE COUNTY Auditors asked to investigate missing funds

The final audit will be released to the public.
By LAURE CIOFFI
VINDICATOR PENNSYLVANIA BUREAU
NEW CASTLE, Pa. -- A significant amount of money is missing from Lawrence County's coffers, but before revealing the total amount county commissioners have asked auditors to be doubly sure where it went.
Commissioner Steve Craig said forensic auditors from Packer Thomas should complete their work within the next two weeks.
An initial audit done by the company more than a year ago was the basis for criminal charges filed Sept. 7 against county Treasurer Gary Felasco. Fraud and embezzlement are among the charges Felasco faces.
Commissioners asked the company to do more work after a report given to them about 10 days ago did not give enough detail.
Craig said they wanted to ensure that any money deemed missing was not incorrectly put into another account or mismarked by the treasurer's office.
"We want to make sure when we are done that the procedure we use will allow us to go to the bonding company and recover our funds," Craig said.
First audit
Packer Thomas' first audit focused on a three-month period -- October 2003 to December 2003 -- and showed about $44,000 missing from county coffers. The new audit focuses on Felasco's entire tenure as county tax claim director from 2000 to 2003.
Commissioner Dan Vogler said the auditors have also been asked to look at the county tax claim bureau for 2004 -- the year after Felasco was removed -- to see if there are any discrepancies.
Craig and Vogler called the money found missing in the most recent audit "substantial" but did not want to release the final figure until auditors are finished.
Craig said they will release all information to the public. This most recent phase of the audit will cost $8,000 to $10,000.
Felasco was removed from his appointed position as tax claim director in 2004 when county commissioners learned Felasco had not paid his property taxes since 2000, and improper court stays were placed on the files to prevent the property from being sold for nonpayment of taxes.
Deputy Treasurer Gloria Conti testified at Felasco's preliminary hearing that the treasurer took tax dollars for his own use, including payment of personal utility bills, and to buy a van. Police believe Felasco took cash paid directly to his office and substituted checks sent by mail to balance the books. Names of those who paid by check were later removed from lists of delinquent taxpayers, according to court papers.
Jury selection set
Felasco's trial on criminal charges is set for May in Venango County. Jury selection is tentatively set for May 1, according to Anthony Krastek, senior deputy attorney general, and Felasco's attorney Jim Ross. Both were recently contacted by Senior Visiting Judge Michael Wherry to set up the court schedule.
Krastek and Ross say they expect the trial to last about one week. It's unclear when the trial will begin. According to Venango County court personnel, juries are selected on the first day of a two-week trial term and then told to come back at a later date during that period for the trial to begin. Felasco is accused of taking more than $40,000 from his office for personal use. He is free on $25,000 bond.
cioffi@vindy.com