(Updated Wednesday, Jan. 9, to show that former Teton business manager Carl Church is not a suspect in the investigation.)
DRIGGS — The Teton School District’s business manager has resigned after reportedly sending more than $784,000 of taxpayer funds to a fraudulent online account.
The FBI continues to investigate the major case of fraud in the district, located some 60 miles northeast of Idaho Falls. In December, the district notified police that an employee made an electronic payment of $784,833.71 to a fraudulent bank account accessed through a district email account. Teton Superintendent Monte Woolstenhulme said the payment consisted mostly of school bond funds meant for Headwaters Construction Company, the Victor-based general contractor overseeing construction of a new elementary school and other district renovations.
“It was one of the monthly construction payments,” Woolstenhulme said. “We have been making construction payments since we started and these funds are from the bond.”
The district’s bond payments are not typically made electronically, district leaders told the Teton Valley News. Usually, the superintendent, business manager and a trustee review and approve such transactions. Church deviated from protocol and made the payment electronically, Teton Board Chair Chris Isaacson told Idaho Education News.
Despite Church’s break from protocol, Teton County Deputy Andrew Sewell told Teton Valley News Monday that the former business manager is not a suspect in the case. Instead, he is a victim of fraud.
“It was a believable scam that he fell victim to,” Sewell said, adding it’s “one of those things people need to be a lot more vigilant when paying online.”
Teton Valley News also reported Monday that Woolstenhulme and Church had discussed paying Headwaters electronically. Still, Isaacson said Church did not verify such a process from Woolstenhulme or Headwaters before making the payment.
The FBI is heading up the investigation, according to the Teton sheriff’s office. The district is conducting an internal investigation and has notified its insurance carrier, Idaho Counties Risk Management Program (ICRMP), of the issue. Isaacson said ICRMP would likely cap what could be recovered at $500,000, leaving the remaining $284,000 to be paid from the district’s reserve fund.
It’s not the first time Teton has been the target of fraud. In March 2017, the district paid nearly $20,000 to a fraudulent bank account. The funds were recovered through ICRMP. Isaacson told Ed News that Church was employed as the district’s business manager when this smaller instance of fraud took place. She would not discuss specifics of how it happened, or whether Church was involved.
This is one of the largest cases of school district fraud in Idaho history. In 2015, Rob Greiner of the Horseshoe Bend School District was convicted of misusing public funds in the amount of $53,000, and Danielle Pearson, a school secretary in the Blackfoot School District, pleaded guilty to misusing $11,000 in public funds.