Sheriff’s Dept. Investigating Bureau’s $41,307 Discrepancy

Editor’s Note:  Correction Appended

The Door County Sheriff’s Department is investigating why the Door County Visitor Bureau (DCVB) could not account for $41,307 in its 2010 audit.

“The investigation by Investigator Jim Valley began in late February and is in the very early stages,” Sheriff Terry Vogel said. He declined to comment further.

DCVB President and CEO Jack Moneypenny said the bureau’s auditor, Erickson and Associates, determined that the money is not actually missing, but it is attributable to data corruption in Quickbooks, the program the bureau uses to manage its books.

“We will cooperate fully with the investigation and are sure that this was nothing but a data corruption issue,” he said.

The discrepancy was detected by DCVB staff in March of 2010, but Moneypenny wasn’t made aware of the problem until months later. The staff made several attempts to recreate the data, and Moneypenny personally went through copies of all the bureau’s checks at the request of the DCVB’s executive committee; however, Moneypenny could not determine why the discrepancy existed.

When the Door County Tourism Zone Commission (TZC) – the entity that collects and distributes the county’s 5.5 percent room tax of which the visitor bureau receives 66 percent – was made aware of the issue in June of 2011 it consulted with its own auditor, Mike Konecny of Schneck SC, to review the DCVB audit and determine what caused the discrepancy. Konecny “found no evidence of fraudulent transactions,” according to the minutes of the Feb. 8, 2012 meeting of the TZC’s executive committee.

Konecny told the executive committee that a data corruption issue like this is highly unusual, but it has happened before.

Bryan Nelson, owner of the Blacksmith Inn and a member of the TZC executive committee, said he was satisfied that there was no evidence of theft or malfeasance on the part of DCVB staff.

“We looked as hard as we could in our responsibility as oversight of the visitor bureau and could not find a smoking gun,” Nelson said. “At the end of the day it seems that it was money that never really existed in the first place. We have no reason to think that it’s real money that has disappeared.”

A forensic audit might turn something up, Nelson said, but that could cost thousands of dollars. A forensic audit would involve hiring an accounting firm to reconstruct and comb through every invoice, file, and check from the period in question and hand-enter it to reconstruct the books.

“It would be very expensive,” Nelson said. “It might show us exactly what happened, but we probably wouldn’t find any malfeasance.”

The $41,307 represents approximately one week’s worth of DCVB expenditures.

Nelson admitted that the situation “looks real bad,” but that the TZC executive committee and the DCVB board were each assured by their auditors that there was no reason to believe there was criminal wrongdoing involved.

Nelson said the commission’s biggest questions then turned to the DCVB’s financial protocols. At its Feb. 8 meeting, the executive committee raised questions about why Moneypenny or the DCVB’s finance committee didn’t detect the error earlier and why the DCVB staff didn’t inform Moneypenny of the problem right away.

“They have assured us that they have good internal controls,” said TZC Chairman Bob Kufrin. “If those are in place, then how did this happen?”

Visitor Bureau Chairman Bob Dickson said he is confident the investigation will come to the same conclusion the DCVB and the TZC did.

“This was well-vetted by the Tourism Zone Commission,” he said. “Our board is satisfied that there was no criminal wrong-doing involved.”

Kufrin said he expects that the TZC’s executive committee will meet with the bureau soon to review the organization’s financial protocols.

Vogel said the investigation could take at least a couple of weeks.

Correction: An earlier version of this article identified Bryan Nelson as a member of the Door County Visitor Bureau Board of Directors. He is not. We regret the error.