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Beaumont: Allegations of fraud baseless

BEAUMONT, Calif. - Allegations of fraud and money mismanagement have surfaced in the city of Beaumont.  A local business owner says a private audit found misuse of taxpayer dollars.  But the city says these allegations are completely false.
Judy Bingham asks, "What are they hiding?"

In 2005, she started looking into the city's finances.  

"There are lots of problems in this city, I think it will all come to light," said Bingham

Bingham says when she didn't get answers from the city, her group, Beaumont Citizens for Responsible Growth, paid for a private audit.  

"We have been quite successful in uncovering things that I knew were going on," said Bingham.

Libi Uremovic, who conducted the audit, says, "They have several accounting codes that are hidden in their books and not on the payroll, that's things the Mafia does to hide money."

These are serious accusations but, Bingham says it's just the beginning.

"This is taxpayer money that we are looking at and we believe that they are stealing their money," said Bingham.

"When you start looking at your check register and you have these places where you have a $250,000 check cut but it ain't on the back statement check warrant, there is something wrong," said Uremovic.

"The only reason Beaumont didn't go bankrupt is because they cooked their books," said Uremovic.

The city of Beaumont says these allegations simply aren't true.  They say the audit didn't look at all of the facts.

Darci Mulvihill, Beaumont city spokesperson, says, "Really what is happening is that statements are being made without having all of the information without coming to us and asking additional questions about what information is being provided."

The city says Bingham's auditor only looked at one report.  Other documents explain the so-called missing money.

"The city does not write blank checks.  The report that was reviewed had journal entries listed.  Those journal entries don't have the description in that report, but a separate report would provide the detailed information for that," said Mulvihill.

The city also says it gets audited every year. We found copies of these documents on the city's website.

"You do not have to be a registered CPA to request the books.  All I am doing is reporting the information and handing it over to the prosecution," said Uremovic.  "It's basic accounting, everything should match."

The findings have been turned over to the State Controller's office and the FBI, but so far there is no indication that an investigation into the city's finances has started.

We should also note, this is not the first time Bingham has accused the city of mismanagement.  In 2007 her accusations were investigated and the city was found to have done nothing wrong.

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