Dixon, Illinois Mayor James Burke addressed a council chamber packed with citizens and media to explain the administration’s reaction to losing $30 million through alleged theft.
Dixon comptroller Rita Crundwell, who handled all finances for the city since the early 1980s, was arrested Tuesday, April 17, 2012. Crundwell faces multiple charges after city officials discovered more than $30 million had been funneled out of city accounts and into an account Crundwell used for personal expenses.
City leaders have placed Crundwell on administrative leave without pay pending the outcome of the FBI investigation.
Mayor Burke thanked the FBI for its response to the city’s request for an investigation, made after city clerk Kathe Swanson brought bank statements to his attention “which suggested the misappropriation of city funds.”
Mayor Burke described his meeting with a federal agent, saying, “I literally became sick to my stomach, and I told him that I hoped my suspicions were all wrong.”
“When the charges were made against Rita Crundwell yesterday, and she was arrested, I could see those same sick feelings manifested in the faces of city employees,” said Mayor Burke.
He went on to explain how the dwindling account balances seemed plausible for a number of reasons. Dixon officials cannot raise property taxes to meet expenses. Burke cited significant increases in the costs of employee health insurance and infrastructure improvements as examples.
Mayor Burke also said two independent accounting firms conducted annual audits of the city finances and that those audit results disclosed no incidents of noncompliance or other matters that required additional action by the city.
Similarly, Mayor Burke said annual audit results filed with the state resulted in no adverse findings or red flags, and that the bank which held the accounts never reported anything suspicious.
Mayor Burke listed several actions Dixon city leaders planned to take, effective immediately:
- Working with the FBI to acquire assets seized and convert them to cash.
- Although none is thought to exist, the city will retain an independent investigator to determine any other improper activity outside the scope of the current FBI investigation.
- The city will work to immediately retain an interim comptroller.
- The city council will appoint independent panel to research available financial controls to be sure this never happens again.
- The city will find a new public accounting firm to conduct the annual city audit.
“This is a strong city that will recover,” said Mayor Burke, “ We have strong leadership in both professional and volunteers and every facet of the community. This is a beautiful city bursting with vitality and citizens can be proud of its past and confident of its future.”
Read the mayor’s full statement here: Mayor Burke’s Statement to Community 041812
(editor’s note: we initially reported the name of the Dixon city clerk as Becky Swanson, but her name is Kathe Swanson. We apologize for the error.)