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Paonia Loses $400,000 to Employee Fraud


The town of Paonia lost more to employee fraud than first reported. The fraud discovered during the 2011 audit is now totaled at more than 400,000 dollars for 2010 and 2011. Previously, the figure for 2010 had been reported at around 225,000 dollars. The town’s annual budget is around $2 million.

Cindy Jones has been Paonia’s Finance Officer since March. She says that the town has implemented a series of new practices to keep a much closer eye on town finances.

All transactions are reviewed by the finance committee, and a lot of them are also reviewed by the entire council. I have no signature ability and I don't have any access to any of the funds by cash, by check or otherwise. All of the suggestions that were made in the audit have been followed and are either completed and we're doing them or they're in process of being done.

Jones says the fraud won’t have an impact on town operations. The town has submitted a claim to its insurance company for a reimbursement, but Jones says she can’t speak to the status of that at this time.

Town Clerk Barb Peterson says that the matter is entirely out of town’s hands at this point. The case has been sent to the district attorney and their investigation is continuing. The district attorney will decide what charges, if any, to bring against the town’s former finance officer, Kristen Chesnik. The Delta County Independent reports that charges may be filed as early as next week.