City Embezzlement Case Raises Questions About Internal Controls

The recent filing of a felony embezzlement charge against former Cordell city treasurer Miranda McGaha has raised questions about the city’s internal cash control protocols and general management of its money.

Last month, after more than six months of investigation, the Washita County District Attorney’s office filed a single felony charge against Mc-Gaha, accusing the former city treasurer of embezzling nearly $42,000 over a period of roughly 14 months between September 2018 and November 2019.

The alleged embezzlement, according to city administrator J.C. Moser, was discovered by the city’s accounting firm, R.S. Meacham, during their preparation for the city’s annual audit. Moser said the accountants contacted him with a question about what appeared to be a revenue shortage involving the city’s franchise fee receipts, which were significantly lower in the 2018- 2019 fiscal year than they had been in years past.

After looking into the situation, Moser learned that the CableOne franchise fee paid to the city had been deposited into the city’s light and water fund account instead of the general fund account into which it was supposed to be deposited.

According to the affidavit of probable cause filed in the case, on Dec. 9, 2019 McGaha admitted to Moser that she had deposited some of the funds from the franchise fee check into the light and water fund and kept some of the funds for herself. Her employment with the city was terminated at that time.

Based upon this discovery, Moser reportedly asked the city’s accountants to conduct a detailed investigation into the city’s finances. That investigation revealed several alleged instances of embezzlement by McGaha, totaling approximatly $41,823.

Moser said the alleged embezzlement was possible because the city treasurer, the person responsible for managing and making the city’s deposits, was the one allegedly perpetrating the theft.

“The Treasurer is responsible to deposit the funds in the bank,” Moser said. “The person in question was the Treasurer and they were in charge of depositing the money as per the City Ordinance.”

He cited city ordinance 3-1-2, paragraph B, “The city treasurer shall deposit daily all public funds received by him in these depositories.”

McGaha, however, was not the city treasurer during the entire period in which the alleged embezzlement occurred.

McGaha reportedly moved outside the city limits in March of 2019, a move that legally mandated her resignation as the city treasurer. Lawana Price was elected to the position in early April 2019, but inexplicably didn’t assume the statute-mandated responsibility for making the city’s deposits.

Moser said after the alleged embezzlement was discovered, he and Price worked together to create a new, more secure internal cash control policy. That new policy was implemented Dec. 19, 2019.