Amber Township treasurer under investigation by AG for fraud; seeking re-election

By Rob Alway, Editor-in-Chief

AMBER TOWNSHIP — Amber Township Treasurer Connie L. Anderson is currently under investigation for possible fraud by the Michigan State Police and the Michigan Attorney General as a result of discrepancies discovered by the township’s auditor in 2021 and further discrepancies found after a forensic audit in 2022. Though her duties were taken away from her by board of trustees action in October 2021, Anderson continues to be paid $19,134 a year to show up once a month to a township meeting. Additionally, the township has incurred over $120,000 in other costs due to mishandling of township funds and the need to hire other personnel to cover her duties. In spite of all this, she has decided to run for re-election. 

Four major red flags caused the issue to escalate to a criminal investigation:

• Anderson failed to make timely disbursement of taxes to other municipalities and entities, as required by state law.
• Anderson reported she paid her personal taxes, but did not deposit her check for two months after the deadline for winter property taxes; the check was then returned by the bank to the township for insufficient funds. The check was finally paid eight months later. To date, she has not paid late fees or interest, as required by state law.
• Anderson did not reconcile the bank balances with her township records.
• Anderson allegedly used cash from a taxpayer to give herself a loan.

In an audit of the township’s accounting during 2020 and part of 2021, auditor Sarah Kanitz of Lake Michigan CPA Services of Ludington discovered that tax checks from property owners were not being deposited timely in the township’s bank account.

“During the month (of) December 2020, there were no deposits recorded in the township’s tax bank account,” Kanitz wrote in her report. “When we obtained copies of the deposited details from the bank, we noted that many taxpayers’ checks were dated in 2020 that should have been deposited timely. We also noted a tax payment from the treasurer for her personal taxes was dated Feb. 26, 2021, but was not deposited into the bank until April 1, 2021.”

The audit also found that Anderson did not distribute tax money to the appropriate entities. In the month of July 2020, Amber Township did not make tax disbursements to other entities, though the bank account balance was $525.168.

“State law requires timely disbursement of taxes to other governments,” the audit stated. “Delinquent payments are a violation of state law and this process should be remedied promptly.”

Kanitz told MCP that municipal treasurers are required by law to deposit taxpayers’ checks in a timely manner and must remit tax money to other agencies twice a month. Property owners pay summer taxes and winter taxes. While the check is written to the municipality in which they live, the taxes are distributed to several other entities, besides the municipality itself.

In the case of Amber Township, those other entities include millages for Michigan education tax, Mason County operations, Mason County Soldiers and Sailors Relief Fund, countywide senior citizens programs, Mason County Jail operations, Mason County Sherif’s Office road patrol, Mason-Oceana 911, Oakview Medical Care Facility, Mason County District Library, West Shore Educational Service District, West Shore Community College, Mason County Rural Fire Authority, and Ludington Area School District or Mason County Central School District. Additionally, Amber Township taxpayers pay for an operating millage and a road millage.

Kanitz also discovered that Anderson was late in paying her own property taxes, though she dated the check as written by the deadline and recorded, on Feb. 16, 2021, that she had paid the taxes. Further, her check was returned for non-sufficient funds. The actual payment was not made until October of that year.

“While auditing the Amber Township tax account deposits, we noted that there were two taxpayer accounts that had been marked as paid in the tax receipting system, but the checks were returned by the bank for nonpayment,” the audit stated. “When we investigated these returned checks further, we noted that one check was from the township treasurer for her taxes for $823.71 and another was for a commercial business for $2,781.18. Both of these accounts were recorded as paid in the tax receipting system, (Anderson recorded in the township’s accounting system that she had paid her taxes on Feb.16, 2022), and neither had repaid the township by the end of the 2020 tax collection cycle. Therefore, these amounts were not returned delinquent to the county and the township paid out the taxes to other governments for these two parcels. This shorted the tax account at the end of the 2020 tax collection cycle by $3,603.”

Anderson didn’t record her check of $823.71 until April 1, 2021. The check then bounced. She eventually paid the sum of $823.71 on Oct. 22, 2021, but still has not paid the penalty or interest, according to Amber Township Clerk Theresa Rohde.

Further, Anderson did not reconcile the bank balances with her township records.

“This is an essential component of the financial record keeping process and is a mandatory treasurer function,” the audit stated. “The clerk and treasurer’s reconciled cash balances should be compared each month and any variances must be quickly corrected.”

On Aug. 23, 2021, Kanitz informed then-township supervisor James Gallie that Anderson had not paid her taxes and that her check had bounced. On Aug. 30, 2021, Gallie and Township Clerk Theresa Rohde met with Kanitz to discuss the situation and see obtained records from the township’s bookkeeping system, called BS&A.

The audit was presented to the Amber Township Board of Trustees during its regular monthly meeting on Sept. 27, 2021. Following a closed session of the board during its regular monthly meeting on Oct. 25, 2021, and under advice of township attorney, Carlos Alvarado, the board voted unanimously on Oct. 25, 2021 on the following procedures (Anderson was absent during the meeting.):

• To appoint deputy treasurer/trustee Tom Alway to sign checks and make deposits on the general bank accounts (since that time — in January of this year — Alway has been appointed township supervisor, replacing Jim Gallie, who retired. As a result, the township board hired Jeannie A. Miller as deputy clerk).
• To keep all legal documents at the Amber Township Hall, “for safety and also for access of the FOIA (Freedom of Information Act) coordinator.”
• To discuss adopting a policy for allowing the treasurer to work in the township hall office.
• Remove Treasurer Connie Anderson from all township bank accounts until a forensic audit was completed.
• To forbid use of personal computer equipment to conduct township business.
• To discuss with the Mason County Treasurer’s Office to take over the township’s two tax accounts, collect taxes for the remainder of the 2021 season and collect taxes in 2022.

The board unanimously voted to appoint board trustee Tom Alway as the township’s deputy treasurer. It also unanimously rescinded a motion from its September 27, 2021 to add Robert Anderson, Connie Anderson’s husband, to all bank accounts. Robert Anderson had been appointed by Connie Anderson to serve as her deputy clerk but the township board has the sole authority to appoint deputies, according to Michigan township law. In September 2021, the township board rectified the oversight and took action to appoint Robert Anderson as deputy treasurer. Following Connie Anderson’s suspension, Robert Anderson was also removed from his duties.

A forensic audit was prepared by Karl Haiser, a certified public accountant based in Grand Blanc. A forensic audit is a formal examination of an individual’s or company’s financial records to determine if they are accurate and lawful. The goal of a forensic audit is to uncover criminal activity, such as fraud or embezzlement, and to obtain evidence that could be used in court.

MCP obtained the forensic audit through the Michigan Freedom of Information Act.

The forensic auditor agreed with the findings by Kanitz but also discovered that on Jan. 16, 2020, a cash payment of $145.63 was paid to Amber Township for property taxes, but only $100 of the cash was deposited.

“Treasurer Connie Anderson failed to report the full tax cash funds,” the forensic audit states. “Amber Township treasurer Connie Anderson noted cash of $100 on bank deposit slip of $14,919.00 and corrected by West Shore Bank. Connie Anderson wrote a second personal check for $45.63 to cover the (name redacted) cash tax deposit.”

Anderson wrote a personal check in the amount of $45.63 and deposited it on Jan. 24, 2020.

“The personal check of Connie Anderson for $45.63 was deposited January 24, 2020 to cover the missing cash of January 16, 2020,” the forensic audit states. “This is a violation of cash collection standards.

“Treasurer borrowing of township tax cash in the amount of $145.63 is not lawful or permitted under any circumstances.”

The Mason County Treasurer’s Office continued to collect property tax payments for Amber Township until the end of March 31, 2023, costing Amber Township $82,076 in collection fees. Additionally, a forensic audit cost the township $7,500, plus it continues to accumulate legal fees.

Amber Township Clerk Rohde estimates the situation with the treasurer has cost Amber Township over $120,000 so far.

Anderson is not unfamiliar with the township property tax system. She works as an assessor. Her clients include Stronach Township in Manistee County.

Further, in September 2021, Anderson applied for a deferment of her summer 2021 taxes. She and her husband, Robert Anderson, filled out a Michigan Department of Treasury deferment form. Connie Anderson signed it as the applicant and the approved her own form as the township treasurer (which is not allowed). Her reason for the deferment was that her income did not exceed $40,000, checking the classification stating she is 62 years of age or older.

The term of treasurer is four years. Anderson was initially appointed as township treasurer on May 1, 2007, replacing Chuck Keller, who had resigned after serving three years. She was elected in November 2008 and has been re-elected three times since, each time running unopposed. This year, she faces an opponent.

Anderson defended her actions.

“I am human and do face human problems that affect all aspects of everyday life including work,” Anderson told MCP. “I have the experience, which includes the whole cycle of taxation. I am a level 3 (tax) assessor. I worked at the Mason County Equalization Department for nearly 20 years.  All of this knowledge puts me above the general knowledge needed to be a treasurer.  Also, taxpayers can come to me with any concerns and I will be glad to help them through the maze of owning property.  I feel that a township board cannot be of value unless the board works cohesively and supports each other with respect.  I will always be of that mind set.”

Anderson told MCP that her winter taxes were paid on time, on Feb. 16, by personal check, which does not coincide with the date of the actual deposit, on April 1. She also acknowledged that the check was returned for non-sufficient funds. She claims the township board and the county treasurer did not require a fee and interest when the check was replaced. According to Kanitz, the auditor, the township and clerk do not have the authority to waive fees and interest, as it is a state law.

“The results of this audit addressed a few errors,” Anderson said.  “Because of serious health and marital issues I was not, at this time, working at my best.  I did tell the auditor and asked her to be diligent in her audit because of an approximately $3,600 shortage I could not find.  She, Sara Kanitz, did an excellent job in finding two errors that made up the shortage.  My forthcoming of this certainly shows my integrity and honesty.”

Anderson said her oversight of not disbursing funds in a timely manner only occurred three months out of 10.

“In fact, four of the months there were three deposits,” she said adding that “some of the months there was one disbursement and some months there were three disbursements. I guess it was a timing thing. Also, this was never addressed in an audit previously by this auditor and two different auditors. I have not deterred from the way I handle tax monies in other years.”

Anderson has declared she is running for re-election. However, she does face an opponent in the Republican Aug. 6 primary election. Jeannie Miller is also seeking the Republican nomination for treasurer. Miller was appointed deputy clerk in January by the township board to assume the duties normally conducted by the treasurer. Prior to Miller’s appointment, the tax collection was handled by the county clerk’s office while other duties were handled by board member Tom Alway, who is now township supervisor.

Township attorney Carlos Alvarado said a trooper from Michigan State Police Hart Post was assigned to investigate possible fraud. Since that time, the MSP has turned over its report to the Michigan Attorney General. To date, the attorney general’s office has not concluded its investigation.

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