At a special meeting on July 28, the Stevensville Town Council considered a fraud examination report presented by Police Chief Mac Sosa. In the report Sosa, who is a certified fraud examiner, states that he received information on January 27, 2022 that close to $20,000 had been paid out to five employees upon their separation from employment with the town. At the time, then mayor Brandon Dewey was acting as the Financial Officer for the Town of Stevensville and was making the payroll for all employees.
According to Sosa, there is an Attorney General Opinion on the books indicating that severance pay is not recognized in the state of Montana. That led to more investigation and several other “discrepancies” were discovered leading to an entire review of both payables and receivables for the town.
The objective of the investigation was to determine if there were any other possible misappropriation of assets and involved reviewing pay rosters, vendors, previous audits, bank statements, claims, credit card statements, pay notifications, and Brandon Dewey’s pay dating back to 2017. It also involved a review of minutes and agendas concerning Dewey’s pay, an outside Investigative Report concerning the claims, the town’s water billing, lighting district funds and an audit report of the Stevensville Police Department reporting system.
Sixteen individuals were interviewed during the fraud examination but their names were withheld to protect the “integrity of the investigation that was turned over to the appropriate authorities.”
According to the report:
“Did the Fraud Examination Team determine the existence of a misappropriation of assets of the Town of Stevensville?
“Yes, the documents, information reviewed, and interviews conducted by the Fraud Examination Team during the examination indicates that Brandon Dewey, did knowingly misappropriate funds to five (5) employees in the form of Severance Pay. This caused the Town of Stevensville to pay an additional $50,000 in unemployment compensation because of this Severance Pay that was added onto the normal payroll. Brandon Dewey caused himself to be overpaid funds by changing his pay periods from the beginning to the end of the month and to a bi-weekly pay schedule. That Brandon Dewey caused the Town of Stevensville a loss of $12,020,20 for almost a four-month period by processing a claim paid out to his Attorney without Council approval, and the funds were only repaid to the Town of Stevensville after being instructed to do so by the then Town Attorney Scott Owens.
“Other losses to the Town of Stevensville were identified in various forms and cannot be revealed at this time to not compromise the integrity of pending criminal litigation. However, the additional losses identified have been documented and reported to the appropriate authorities.
“This report reflects that Brandon Dewey, a Former Mayor with the Town of Stevensville, in his capacity as a Public Servant did not maintain his fiduciary responsibility to guard the assets of the Town of Stevensville.”
The report offers an estimate of the total amount of restitution for the misappropriated funds at $48,156.56, which is not including the additional $50,000 that was paid out through the Town of Stevensville’s unemployment insurance. It states that additional amounts were lost due to poor/loose controls of the Town’s credit cards and have not been calculated in the above mentioned restitution amount.
The report finally notes that no overtime expenses were incurred as a result of this investigation and all costs were absorbed during the Chief’s normal work schedule. In the case of salaried employees, no additional compensation was offered in addition to the yearly salary amount.
“Had an investigation of this magnitude been performed as a forensic audit by an outside firm, the cost to the Town of Stevensville very well would have exceeded $100,000,” concluded Sosa.
After hearing Sosa’s report and his proposed recommendations, the town council voted unanimously to implement his recommendations.
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