State Audit Shows More Than $1 Million Missing From Farmington Accounts

FARMINGTON (KFSM) -- A former Farmington city employee is accused of failing to deposit more than $1 million in court and general fund revenue, according to a state audit.

An investigative report by the Arkansas Legislative Audit found that Jimmy Story failed to deposit $1,572,022 into the city's bank accounts between January 2009 and December 2016.

Story, who resigned last winter, had served as the court clerk and city finance director since 1995, according to the report.

The report has been forwarded to the Internal Revenue Service and the U.S. attorney's office for the Western District of Arkansas.

The city discovered the discrepancies earlier this year when Story's replacement verified the fine paid by a family member, said Mayor Ernie Penn.

"She wanted to make sure it was reporting correctly, and she found where [the relative] had paid that in cash, but it was never deposited into the city of Farmington's accounts," Penn said.

The same was found with several other accounts, which prompted an internal investigation that Penn said revealed "major discrepancies".

Story was able to manipulate the city's revenue system by taking payments from defendants and keeping the payments out of the court computer system. Story then issued the defendants handwritten receipts.

He kept other city officials in the dark by destroying court records, according to the report.

Story made more than 14,000 unauthorized adjustments to "fabricate reasons that fines, costs and fees collected were not entered into the system," according to the report.

"Usually our budget will match up or will be fairly close as far as the income," Story said. "So, when you don't budget it, you don't necessarily know that you're not receiving it."

Penn said the city has made several changed recommended by the audit, including the hiring of a deputy court clerk. He also reassured Farmington residents that no city account was compromised and no funds disturbed.

"We're going to go forward. Our budget is fine. We're not going to have a misuse of any services that we offer," Penn said.

Kim Weber, a Rogers attorney representing Story, said her client disputes the amount listed in the audit for an action that he "may or may not have committed". She added that the federal investigation should be completed soon.