Gardner indicted
A federal indictment announced Monday accuses Gardner of misappropriating village money for personal use, including mortgage payments. John Madill / H-P staff
Ex-Stevensville manager accused of stealing $293,141 from village
By WILLIAM F. AST III - H-P Staff Writer
Published: Tuesday, February 23, 2010 1:09 PM EST
STEVENSVILLE
Former Stevensville village manager Todd Gardner stole $293,141 from the village, federal authorities allege in a seven-page indictment.
Gardner on Monday made an initial appearance in U.S. District Court in Grand Rapids to face the charges, according to the U.S. Attorney's Office for the Western District.
The indictment charges him with making unauthorized wire transfers of funds and taking money in other ways.
Some of the money was allegedly used to pay down a mortgage on his house.
The $293,141 figure listed in the indictment is larger than the misappropriated $277,647 cited by Michigan Department of Treasury officials in the village's audit.
The indictment said the transfers took place between April 1, 2006, and May 31, 2009, and that Gardner was "village manager and treasurer" and "had primary control" over village funds. Gardner, who was manager during those dates, has denied he was treasurer and had control of village funds.
Gardner on Monday did not respond to a message from The Herald-Palladium seeking comment.
The indictment said Gardner:
-- Made at least 15 unauthorized wire transfers totaling $145,795 from the village's building and major street funds to his own bank account under the name of Southshore Marketing, Gardner's former business;
-- Drafted five paychecks for himself totaling $6,888, when he'd already gotten paychecks for those periods;
-- Withdrew $77,989 from the public works bank account, made another public works account, granted himself ATM privileges on that account, and concealed it by not recording withdrawals in the village account;
-- Took $22,064 from a village construction administration account, got a cashier's check for $22,064, and used that "to pay down a mortgage on his personal residence;"
-- Took $25,844 from a Downtown Development Authority account with most of it also going for the mortgage on his residence;
-- Made unauthorized purchases with village funds totaling $14,557 at Lowe's and Office Depot, using the items "for his personal benefit."
Also, the indictment charges, the "defendant convinced members of the Village of Stevensville Village Council that an audit of the Village's books and records was unnecessary."
"When an audit was finally commenced, Defendant refused to disclose certain documents and records material to the auditors," the document states.
Village officials have said Gardner talked them into having an audit every two years instead of annually - allowable under state law - though Gardner has disputed that as well.
State Treasury Auditor Derek Hall said at a special council meeting last week that Gardner had taken the funds. Hall also said the council was negligent in not keeping a closer eye on what Gardner was doing.
The indictment goes on to list 16 checks for amounts ranging from $104 to $29,566, transferred from village accounts to Gardner's own account at Fifth Third Bank.
If convicted, Gardner "shall forfeit to the United States the sum of $293,140.91," the indictment said.
The village hired Gardner in April 2006. In May 2009 it did not renew his contract. The village had not had a treasurer on board since November 2006 when Jan Lausch-Zilke stepped down, reportedly after disagreements with Gardner.
Once Gardner was no longer with the village, officials said, it quickly became apparent that the financial books were in disarray. Officials hired Berrien County Treasurer and former Stevensville Village Manager Bret Witkowski to be interim manager, brought in a certified public accountant to reconstruct the books and contacted state officials.
Those moves prevented appointment of an emergency financial manager by the state, village officials said.
The village is struggling with a shortage in funds caused in part by the alleged embezzlement. Witkowski has limited the village to paying no more than $35,000 a month in bills until the shortfall is made up. A much bigger concern, Witkowski said, is the $691,435 in loans that the village's DDA owes for buying lots to expand the downtown.
Federal court officials said Gardner faces arraignment Friday, news accounts said.
wast@TheH-P.com
