Phishing Scam Exposes Legal Violations in Village Finances

Recently an article was published on Mlive about the $989,000 dollars this village council lost to an email phishing scam. One thing that stood out to me was the statement

Loughrin said the person who puts invoices into the village’s computer system cannot be the same person who approves invoices. She said she and Franklin-Bingham Police Chief Curt Lawson are the official signers and secondary signers for checks.

This is a clear violation of the law which requires the treasurer to have custody of funds, and requires the Clerk and the Village President to sign off.

The Law

Section 2. The Village Treasurer shall be the general accountant of the Village and shall keep a complete set of accounts showing the financial transactions of the Village, which accounts shall conform to the uniform system required by law. The Village Treasurer shall receive and disburse all moneys belonging to the Village and shall keep an accurate detailed account of all money received and disbursed by him or her and of the particular fund into which or from which said money is paid. He or she shall pay out no money except upon warrant issued as in this Charter provided. He or she shall, at least once every three (3) months and oftener if required, furnish the Council with a statement showing all cash on hand and in the bank at the beginning of the preceding period, the receipts and disbursements for the preceding period, the cash and bank balances at the end of the preceding period, and the condition of the several funds of the Village. He or she shall make such other reports as the Council may require. Section 3. No money shall be drawn from the Treasury except upon the warrant of the Village Clerk countersigned by the Village President. Every warrant shall specify the fund from which it is payable and shall be paid from no other fund. No warrant shall be drawn upon the Treasury after the fund from which it should be paid has been exhausted, and if any such warrant shall be drawn it shall be void. No warrants shall be issued until the same have first been authorized by the Council; provided, however, that the warrants may be issued for the payment of labor and current expenses with the prior authorization of the Council, if authorized by the President, but the total amount of such warrants issued between any successive regular meetings of the Council shall not exceed such an amount as the Council shall from time to time establish. All liquidated accounts and demands against the Village shall be received and audited by the Village Treasurer who shall enumerate them on a regular form prescribed by the Council. The Treasurer shall certify to the Council as to the correctness or incorrectness of the various amounts on such list. The Council shall authorize the issuance of warrants on the Treasury for the payment of such items as shall be approved by it.

Illegal Operations Persist After Phishing Scandal

There are four lawyers on our Village council, and one Police Chief involved with these illegal operations:

  • David Goldberg: Law Office of David A. Goldberg P.C. 
  • Angelina Sulaka: Administrative Office of the United States Courts
  • David Sahli: Rocket Mortgage
  • Daniel Ferris: Kerr Russell
  • Curt Lawson: Franklin-Bingham Farms Police Department

The charter is 28 pages and ignorance of the law excuses no one. When those in charge of writing and enforcing the law are the ones breaking it; how does it get enforced?

Hidden Information Uncovered by Residents FOIA

The council made every effort to hide the truth from residents by:

  • Scheduling the Treasurer’s comment at the end of a very long meeting, after a closed session to ensure residents were not present
  • Cut the video feed during this public open meeting to avoid having it recorded to residents could listen.
  • Published meeting minutes completey devoid of any details

Treasurer Raised Concerns to President and Administrator

The Treasurer raised concerns about the banking setup not requiring dual authorization to President David Goldberg and Rachel Loughrin. This was ignored until it was too late, then this council wrongfully terminated her to hide their culpability. The full explanation of events leading up to this is outlined in the statement from the Treasurer below.

teresa jablonski statement at council meetingDownload

Clean Sweep Needed

We need to work on getting a whole new group of people. Today’s council can’t follow a simple 28 page charter. The council and administration are inept, and in their rush to hide things they engage in more and more illegal behaviors.

  • Illegal banking setup
  • Illegal procedures for issuing checks
  • Violations of OMA Open Meetings Act
  • Wrongful termination of a treasurer that raised the alarm about the improper banking setup
    • Only Daniel Ferris had the sense to vote no on this
    • Trustee Abby Gates a self proclaimed HR “expert” and founder of Sproutwise, a temp services company for HR functions voted in favor of this wrongful termination
A document displaying a motion to terminate the employment contract of Teresa Jablonski as Village Treasurer, including a roll call of votes from members, with the outcome indicating the motion was carried.

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