Westfield council hears forensic investigators’ plan for reviewing city finances

Mayor Andy Cook’s team of forensic investigators introduced themselves to the Westfield City Council during a special meeting on Tuesday and explained how they plan to examine the city’s financial operations.

In July, the council approved a resolution requiring additional oversight of the Grand Park Sports Campus’ contracts following allegations from council member Troy Patton that Westfield-based Bullpen Tournaments LLC, which manages the park’s ball diamonds, had diverted $470,000 away from the city.

After questioning the council’s authority to enact that review, Cook effectively vetoed the action by not signing the measure. He then appointed outside consultants to conduct a review of all city financial practices and accounts.

“Recently, there’s been some accusations floating around about how much cash the city has available and accusations of funds being diverted from one city contractor to another,” Cook said. “It’s just time we get this all out, very open and transparent.”

Tuesday’s meeting introduced the mayor’s appointees as Daniel Hedden, partner with public sector advisory firm Baker Tilly Municipal Advisors LLC; Zachary Klutz, partner in the law firm Taft Stettinius & Hollister LLP; and Bryan Callahan, partner with the accounting firm BKD CPAs & Advisors.

Callahan said one distinguishing factor about the review would be its use of forensic data analytics to go beyond comparing the city’s financial statements to accounting standards. He said the practice will dig deeper to find fraud, waste and abuse if there is any.

“Many times, you’re just doing a sampling technique that would be just pulling 20 to 30 transactions and hoping that’s representative,” Callahan said. “What we do is what we call our 100% test. We’re going to test every payment going out the door.”

That will include reviewing purchase card and payroll transactions, bank statements and other financial information from 2017 through June 2020.

Additional facets of the investigation will require consultants to interview employees, conduct background investigations, look at relationships and potential conflicts of interest, review the city’s rules and regulations, identify areas of risk like cash handling and provide advice for making sure any recommended changes stick.

Not all of the review will be exhaustive. BKD will also do some sampling of contracts, their approval processes and whether the terms of those contracts are being met to provide a statistically significant sample of those operations.

“If we were putting human eyes on every single transaction, the cost would be through the roof,” Callahan said.

Hedden, Klutz and Callahan said they’ll work together to deliver a singular report to the mayor within the next four to six months. The consultants did not, however, provide a cost estimate.

“We don’t know how much data we’re going to be analyzing. What we’ve committed to do is provide constant updates,” Hedden said. “It’s not a blank check situation. We do know there are limits.”

Further complicating the specifics of the investigation is the fact that, though each appointee has worked on similar investigations, none have done so under Cook’s chosen statute.

“All of the findings of fact will be included in that final report that we will all see,” Cook said.