Wallkill Fire District’s inadequate financial controls results in embezzlement, state audit says

ALBANY – The Board of Commissioners of the Wallkill Fire District did not establish adequate internal controls over the cash disbursements process, resulting in $239,622 being stolen by its former chairman, an audit by the state comptroller’s office said.
Michael Denardo, 39, of Wallkill, was sentenced on Friday to 2 1/3 to seven years in state prison for stealing the money and funneling it through his wife’s bank account without her knowledge. He also used the district’s credit card to make $14,910 in questionable purchases, including gas, cigarettes, groceries and other personal items.
The state review said the district board did not perform a proper audit of claims prior to payment or ensure that adequate supporting document was attached.
Key recommendations from the audit include a review of the questionable disbursements identified in its report and to seek reimbursement as appropriate and implement a cash disbursement policy that prohibits distribution or signing of blank checks.  The state also said all claims should be properly audited before authorizing payment and ensure that each claim has detailed supporting information.