Report details alleged $500K theft from Charlton fire district

PHOTOGRAPHER: Stephen Williams

Former Charlton Fire District Secretary-Treasurer Virginia DeCapria misappropriated as much as $500,000 in taxpayer funds over a six-year period, state Comptroller Thomas P. DiNapoli said Wednesday.

State police arrested DeCapria two weeks ago on a charge of second-degree grand larceny, but details of the allegations weren’t released until Wednesday, as part of a new comptroller’s audit of the fire district.

DiNapoli said DeCapria, who was responsible for fire district finances from 2005-10, improperly paid herself $316,670 over that time. She is also accused of using fire district credit cards to buy dozens of personal items, including backyard patio bricks, a washer-dryer, refrigerator, furniture and electronic equipment, much of which cannot now be accounted for.

Other district officials were apparently unaware of the alleged thefts, since they left the bookkeeping to DeCapria. She had a small salary — $7,200 in 2005, rising to $8,428 in 2010 — but the audit found she paid herself significantly more.

The fire commissioners will hold a meeting at 7 p.m. today at the fire station to discuss the audit and procedural changes they have made.

“This treasurer went shopping at taxpayer expense, with no one minding the store. There must be zero tolerance for such an outrageous abuse of taxpayer dollars,” DiNapoli said Wednesday at a news conference in the Saratoga County District Attorney’s Office.

The comptroller’s office began an investigation last summer after doing a “risk audit” requested by town officials, who were concerned about the fire district’s spending. That initial evaluation quickly determined DeCapria was writing checks to herself, DiNapoli said, leading his office to conduct a full audit and turn its findings over to state police.

DeCapria, 50, of Charlton, is charged with four counts of grand larceny and one count of falsifying business records, all felonies. She has pleaded not guilty to the charges.

Her attorney, Terence Kindlon of Albany, declined comment on the audit until he had a chance to read it, but said, “I see nothing at this point that tells me she’s guilty of anything.”

According to DiNapoli, there was a lack of internal financial controls within the volunteer fire district that allowed the thefts to occur.

“Internal controls over the fiscal activities were virtually non-existent. The treasurer was able to make purchases, pay bills, write checks and process payroll with no oversight,” the audit states.

The district has now implemented financial control procedures recommended by the comptroller’s office, said Terrence Hannigan, the fire district’s attorney. Hannigan said new finance review procedures have been instituted, and some of the five members of the board of fire commissioners have been replaced.

“I am extremely confident that, though it will happen again, it will not be in Charlton,” Hannigan said. “This was a classic case of misappropriation of funds.”

The fire commissioners fired DeCapria in January as the comptroller’s audit was under way.

At tonight’s meeting, Hannigan said, commissioners will discuss the audit and the financial management changes they have made but will not be able to discuss the pending criminal charges against DeCapria.

“We are the victims here,” he said.

DeCapria’s husband, Dean, was the Charlton fire chief throughout the time the thefts occurred, District Attorney James A. Murphy III said, but there’s no evidence he knew about his wife’s conduct — even though $40,195 in checks were made out to him.

“He has been fully cooperative with the state police,” Murphy said. “She was the financial person in the household.”

Murphy said the alleged thefts began small — less than $10,000 in 2005 — but grew each year to the point where DeCapria improperly paid herself $158,187 in 2010 — more than 50 percent of that year’s fire district tax levy.

DiNapoli credited town officials with first bringing the matter to his office’s attention.

Charlton town Supervisor Alan Grattidge went to the comptroller’s office last year after being unsatisfied with the response of district officials to his requests for budget details.

“Probably the last two budgets they submitted had requests I thought were extravagant in the personnel services part of the budget,” he said.

The total fire district budget for 2011 is $308,723. The district tax levy rose from $160,000 in 2005 to $308,000 this year, something Grattidge said he regularly heard residents complain about. District residents have rejected multi-million-dollar plans for a new firehouse three times in five years, with the prevailing opinion being that fire district taxes were too high already.

Town officials, however, do not have direct oversight over fire districts, which by law are independent of town government. DiNapoli said all fire districts need to comply with 2006 legislation that requires annual independent audits, however, but the Charlton district did not.

“You had a small operation. There was a trust relationship [with DeCapria],” DiNapoli said.

Among DeCapria’s purchases, according to the audit, were 256 backyard patio stones, 14 printers, seven laptop computers, a washer-dryer set, refrigerator and freezer, eight digital cameras, four media players and home furnishings.

While some of the purchased electronics were found in the fire station, the audit said most are unaccounted for. Murphy declined to comment on what DeCapria might have done with the other items, but said no money has been recovered to date. Her bank assets have been frozen, he said.

DeCapria is currently free without bail, pending presentation of the case to a grand jury. She faces as much as five to 15 years in prison if convicted of second-degree grand larceny.