CHESTERFIELD, Ind. — Five former town employees defrauded the town of Chesterfield of more than $250,000 over two years, according to a state audit report released Thursday.

The audit alleges that town employees filed mileage reimbursement claims for trips never taken, issued auto repair claims for repairs never made and paid for maintenance work never performed.

“It’s made me sick. It just makes you sick to your stomach to think that people think they can get by with that stuff. It just blows you away,” Chesterfield Town Council President Jack Taylor said Thursday when the report was released.

The 31-page audit report filed by the State Board of Accounts details how former Clerk-Treasurer Chris Parrish, former Town Marshal James Kimm, former part-time police officer Joseph Brown and former water department and maintenance employees Chris Walters and James Walters allegedly defrauded the town of $259,626 during 2007 and 2008.

The unscheduled audit was requested by town officials in February, just one month after Parrish abruptly resigned as clerk-treasurer and town manager, according to current Clerk-Treasurer Candy Bennett.

As clerk-treasurer for the town, Parrish handled all expense reimbursements and purchase orders for the town.

He was named in connection with nearly all questionable claims included in the audit.

Bennett said she was shocked to learn that Parrish had been defrauding the town. “I would have never thought he would do this.”

Roads not traveled

Between January 2007 and August 2008, Kimm filed mileage reimbursement claims totaling $52,553.

Kimm claimed to have been traveling across the country to pick up free excess government property for the police department through the Defense Reutilization and Marketing Office, or DRMO.

When auditors called the DRMO, they found that no one from the town of Chesterfield, including Kimm, had picked up equipment in 2008, nor was any equipment distributed to the town in that year.

In April 2008, Kimm’s mileage form indicated that he had driven his personal vehicle to San Diego, Calif., and returned in the same day.

It would take the average driver 64 hours to drive to San Diego and back, according to Mapquest.

His mileage form also indicated that he’d traveled to Fort Hood, Texas, and back in one day in January 2008.

That round-trip would have taken 34 hours by car.

According to the audit, the 31 travel claims presented by Kimm were not presented to the town council as required by statute.

Instead, Parrish entered the checks into the town’s computerized accounting system as manual checks.

These manual checks were kept from council members, according to the audit.

“There is no evidence Town Marshal James Kimm actually traveled in his personal vehicle to the locations listed above,” the report noted.

“I would’ve thought we would’ve known if he was gone to California,” Capt. Steve Mullen of the Chesterfield Police Department said Thursday after reading the report for the first time.

Mullen said he saw no indication that Kimm was misusing town funds.

He did sense a change in the police chief at the start of 2009. “We did not suspect anything until the clerk-treasurer resigned. Jamie got very depressed. It was like he’d lost his best friend.”

Interim Chesterfield Police Chief Robert Stewart said Kimm gave no indication that he had an extra $50,000. “He led a simple life. He drove a 10- to 12-year-old car.”

Parrish reportedly filed several fraudulent mileage claims of his own.

In 2007 and 2008, Parrish collected $9,646 in mileage reimbursement, according to the audit.

Parrish reported that he drove an average of 992 miles per month around the city limits of Chesterfield, claiming to be checking on town business and ongoing projects.

“The number of miles traveled seemed excessive,” the report noted.

Fraudulent repairs

During 2007 and 2008, Parrish and Kimm also allegedly worked with Chesterfield part-time police officer Joseph Brown to fabricate auto repair bills totaling $115,391.

Brown is Kimm’s half brother and joined the police force as a reserve officer in 2004. He became a part-time officer in 2008 but failed to pass the physical requirements to serve on the police force.

The audit reveals that Parrish signed automotive repair claims approved by Kimm for 24 repair payments to Brown’s Automotive in Anderson.

The $115,391 price tag for car repairs came as a surprise to acting chief Stewart. “I think our repair budget is $12,000 a year.”

Questionable fix

Parrish is also accused of paying $37,600 in claims to a maintenance worker for work that was never performed.

Although Parrish approved checks for the cleaning of carpets and sealing of basement walls at the clerk’s office, employees said the work was never done.

Bennett, who’s worked for the city for 23 years, said she never saw any of the work being done during her time.

The report details that Parrish also asked the council for permission to hire a personal secretary but was denied. Records indicate that he did so anyway and paid two people $1,800 using manual checks not presented to the council.

Parrish is additionally accused of purchasing personal computer equipment using town money. The audit discovered five payments for computers and equipment not accounted for at the clerk’s office along with several mysterious miscellaneous purchases totaling $1,944.

According to the audit, he misappropriated petty cash, sought reimbursement for business calls on his personal cell phone that could not be accounted for and failed to provide receipts for tool purchases.

In September, maintenance worker James Walters and his brother, utility superintendent Chris Walters, were fired by the Town Council.

Town attorney Bill Kreegar told The Herald Bulletin in September that the firings were not related to the state investigation into theft by employees.

On Thursday, Town Council member Karen Wilson said the men were fired because of what council members saw in the audit.

The audit details that Parrish paid the two men a combined $14,000 in overtime that they did not earn.

This resulted in additional benefits due to inflated hours totaling more than $3,000.

“We decided at that point that the boys needed to go to because of what we found,” Wilson said.

Board President Jack Taylor wasn’t comfortable discussing the Walters’ firings due to ongoing litigation with their union.

“Nobody should probably comment on that right now. They are trying to get their jobs back, yes.”

James Walters said Thursday that he is fighting his termination, blaming Parrish for the fraudulent paychecks. “My response is that I worked at the direction of my superior, town manager and treasurer Chris Parrish. I have never knowingly violated any laws, rules or work rules that are related to my job as an employee of city of Chesterfield. I have never done anything that was not at his direction or by his request. My actions were directly related to the town Clerk-Treasurer Chris Parrish.”

In the wake

Town officials say they were shocked to learn of the allegations against the five former employees.

Town Council member Rick Waldron said keeping the investigation into the alleged fraud from the public was difficult. “We knew people felt like we were avoiding them and not talking about it because we didn’t want to and that wasn’t the case. We want people to know what went on.”

“We couldn’t wait for this to come out,” Waldron said.

The state audit found that members of the Town Council had no knowledge of the theft.

“The only thing I did wrong was I trusted somebody,” Taylor said.

Council members say they’ve learned from the experience.

A series of checks and balances have been established, Bennett said, to ensure that town council members understand how money is being spent in the town accounts.

Bennett now requires purchase orders of all town employees before expenses are approved and provides the council with a detailed docket showing payroll hours and accounts.

The five people involved in the investigation have been ordered to pay a total of $259,626 in restitution to the town.

Wilson said council members are now more vigilant.

“We’re even going to see about one board member monthly balancing the check book. It’s not something we have to do but State Board of Accounts said that’s the only thing we can do to make sure this never happens to our town again.”

Contact Brandi Watters: 640-4847, brandi.watters@heraldbulletin.com