An administrator at a small school district in Avenal created fake invoices for book sets and board games when she was really buying gift cards – most of which are now missing.
That’s the conclusion of an audit of invoices submitted by Reef-Sunset Unified School District Chief Business Officer Michelle Cutillo. According to the audit, items she listed did not match up with store records of her purchases. In most cases, Cutillo claimed she was buying items like books or “student incentives,” but store records show she bought gift cards instead.
The audit is up for discussion at Thursday’s district board meeting.
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The audit estimates that Cutillo purchased $289,000 worth of gift cards since 2006, much of which now cannot be accounted for. Approximately $28,000 worth was distributed to school sites, and $83,000 was potentially stolen from a safe in 2009, leaving $118,964 in missing gift cards.
“It is clear that the purchase of gift cards was excessive and controls over them severely lacking,” the audit says. “It was apparent that the extent of these purchases was kept from administration and other business office staff. The descriptions on the fictitious invoices were meant to hide what the actual purchases were for; gift cards.”
Superintendent David East said the audit was requested by the Kings County Office of Education in response to an anonymous tip made to the Avenal Police Department. East said he cannot comment on whether Cutillo is still employed at the district, calling it a personnel issue.
The money for the gift cards came from a grant-funded after-school program, according to East, which the district will now look to reimburse while distributing the remaining gift cards – $58,000 worth – to teachers and students. Gift cards that cannot be distributed will be used by the district, and it won’t allow gift cards to be purchased again.
Referred to DA
The matter has been referred to the Kings County District Attorney’s Office, East said.
“This audit has been going on since last February,” East said. “It’s just good to get closure.”
The audit also describes a phone conversation in which Cutillo tried to arrange for $5,000 in gift cards to Famous Dave’s restaurant for a field trip, as well as another incident when Cutillo invited an employee to her house to count cash on hand that totaled up to about $40,000.
“Due to the lack of documentation, it is impossible to determine if that $40,423.46 of cash on hand at Michelle Cutillo’s house was all that she had collected from the sites over the years,” the audit says. “Although the amount is more than what can be documented in our attempts, it is not to say that the actual cash collected by Michelle from the sites over the years was well over that amount.”
Gift cards, movie vouchers and undeposited checks were all also found in the business office, the audit says.
The audit was conducted by accounting firm Vavrinek, Trine, Day & Co.
The county office of education released a statement summarizing the corrective actions the district will take in response, including having the superintendent review all purchase orders for propriety.
Parent Veronica Aguirre said she recalls canceled field trips and other activities in the years that Cutillo was the chief business officer, and worries that Cutillo’s actions may have been the cause.
“The audit only goes back so far and she’s been there a long time,” Aguirre said. “She’s been the keeper of the purse strings.”