Art center audit questions $20K, finds poor spending oversight and ‘high risk of misappropriation’ | PostIndependent.com

Art center audit questions $20K, finds poor spending oversight and ‘high risk of misappropriation’

A 2015 trip to Disneyland and payments to a credit repair law firm, the latter of which mirror those made from former Glenwood Springs Center for the Arts Executive Director Christina Brusig's personal checking account, are among $4,789 in "likely unauthorized" expenses outlined in an audit of arts center finances.

The audit details another $5,937 in expenses that may have been unauthorized, and $9,455 worth of payroll and other reimbursements to Brusig that require further explanation, according to the report.

It says that "it seems unlikely the center had sufficient internal controls to limit any potential misappropriation of funds prior to deposit," and "any cash payments for center services can be considered to have an inherently high risk of misappropriation."

A copy of the audit report, dated June 20, was provided Tuesday to the Post Independent via a Colorado Open Records Act request with the city of Glenwood Springs.

“We are checking through our books to provide any data and documentation that is requested.”

— Kate McRaith,arts center board president

The audit report was prepared by McMahan and Associates accountants of Avon on behalf of the city, which began its own investigation into the finances of the arts council in April due to the city's longstanding financial support of the organization, including paying the executive director's salary.

Recommended Stories For You

Whether any criminal charges will result from the findings will be up to 9th District Attorney Jeff Cheney, who is reportedly in receipt of the information.

Brusig, who resigned from the arts center in early April, also told the Post Independent that she has not been contacted about any of the questionable charges. She said that any and all expenses were approved by the arts center board.

"Any trips or other things like that were for our competitive dance team, which made it to nationals several years in a row," Brusig said when questioned about the $2,695 in Disneyland-related expenses from 2015 that show up in the report.

"Everything would have been approved by the board," she said. "I'm happy to help answer questions about any of this, but I haven't been asked to.

"I've never tried to hide anything from anyone, ever," Brusig said.

Her attorney, former DA Sherry Caloia, said there's nothing in the audit report to indicate wrongdoing.

It is clear the organization was in financial straits based on the amount of overdraft charges and other indications of a cash-flow problem, she said.

"Most of the checks in question had bylines on them, so the record is pretty good as far as where the money went," Caloia said.

Shortly after Brusig's resignation, the arts center announced that it was some $68,000 in debt to instructors and other vendors and that its future was uncertain.

The organization, with support from the community and after a series of fundraisers, has been able to piece together a plan to stay open through at least this year, according to Kate McRaith, president of the arts center board.

POLICE INVESTIGATION

Glenwood Springs Police Chief Terry Wilson said his department is still compiling additional information as part of its probe into arts center finances. He confirmed that the results of the audit have been turned over to the DA.

The audit included a review of handwritten checks, payments to any "unusual vendors," checks made out to Brusig, as well as cash and debit card withdrawals.

"From 2014 through March 2017, 29 checks were paid to the executive director for a total of $9,651," according to the report. "Nearly all of the checks contained memos which referenced payment for additional payroll from teaching classes or for expense reimbursements.

"Interviews with a board member indicated her understanding was that the executive director was 'volunteering' for these classes and should not have been paid these additional amounts," the report stated.

However, Caloia said Brusig was advised by the board that she needed to be paid for any work beyond her director duties.

The audit also questioned an April 27, 2016, check for $1,600 written by Brusig to a direct family member, with a memo indicating it was a loan repayment. No such loan was detailed in board meeting minutes, the report said. However, the auditor also indicated that access to board minutes was limited.

DISNEYLAND

Among the debit card charges in question was $2,695 in total expenses for lodging, car rental and Disneyland tickets in 2015. Again, Caloia and Brusig said that was all legitimate expense related to taking the dance team to a competition, which they said was approved by the board.

Other apparently unauthorized expenses, according to the report, included $1,120 paid to the credit repair agency Lexington Law in 2016 and 2017.

"Monthly charges from Lexington Law began appearing on the center's bank statement in September 2016," the report states. "Communication with the Glenwood Police Department indicates that the executive director's personal checking account had Lexington Law charges for the same monthly amount from August 2016 and prior."

Caloia said it's likely Brusig used the same agency to help clean up the art center's credit that she also employed for personal reasons.

AUDIT WILL LOAD BELOW

 

In an unrelated matter, Brusig pleaded guilty in late April to felony check fraud charges in Eagle County for writing bad checks to her landlord, who lived in Eagle County. In a deferred sentence, Brusig was ordered to repay $16,470 in restitution, and after two years would have the criminal record removed.

According to 5th District Attorney Bruce Brown, Brusig is on track with her restitution payments, having paid $12,274, leaving a balance of $4,196.

McRaith said the arts center board has also been cooperating with authorities in providing documentation as requested.

"We received the audit at the same time as the Police Department, and we are checking through our books to provide any data and documentation that is requested," she said.

McRaith declined to comment regarding any personnel matters related to Brusig's tenure with the organization.

"The board and administration are and have been cooperating fully with all stages of the investigation," she said.

 CITY CONSIDERS CUTTING TIES

The Glenwood Springs City Council will meet to discuss ending its relationship with the Glenwood Center for the Arts.

Go back to article