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Paonia Embezzlement Case Draws To A Close

Paonia Town Hall
KVNF

After years and years of embezzlement, a criminal case, and prison time, the town’s dealings with Kirstin Chesnik are coming to a conclusion.  On Tuesday night, the town accepted the terms of a civil settlement with Chesnik.

At the meeting, the chain of events that led to the settlement was recounted.  Trustee Charles Stewart gave a recap of the criminal investigation and the towns actions.  Chesnik was never absolved of the embezzlement, but Stewart did point out several errors and missteps the town made that let the theft go on for so long, starting with her hire. 

“Ms. Chesnik was appointed the town’s financial officer,” said Stewart, “although she only had a high school education, no financial training, and a prior misdemeanor theft conviction.  Her prior work experience was working as a clerk at a grocery store and tending bar.  She was given no training, she was incapable of using the town’s accounting software, and she was left unsupervised.”

Stewart continued, saying that she stole $20 in 2005.  By the time it was noticed, she was stealing hundreds of thousands of dollars.  Two years ago, she pled guilty in court to stealing almost $400,000.  Stewart says it wasn’t terribly sophisticated.  Chesnik simply cashed checks to herself, and used the town’s debit card for personal expenses.  But no one was watching.

“No controls were in place to prevent the theft.  Review of virtually any bank statement from the town’s operating account would have revealed the theft,” said Stewart.

It was tricky to nail down exactly how much was stolen, and what was a legitimate expense.  The town was paying expenses, such as crews working on the sewer system, with envelopes of cash without receipts. 

With this new civil settlement, Chesnik and the town are in agreement that Chesnik owes the town about $480,000.  Paonia will also be in charge of collections. 

“The town’s collection efforts will not end,” said Stewart.  “If any credible information is provided to the town that Ms. Chesnik has, or becomes entitled to, any asset of any significance, the town will exercise those remedies.”

The problem is that Chesnik doesn’t have $480,000.  According to the town’s findings, she’s actually in debt, with no substantial assets.  They’ve been looking into what she has, even hiring a private investigator to try to find any hidden bank accounts.  They didn’t.  Any further litigation or investigation might just run up a total that the town might not ever be able to collect.  Trustee David Bradford feels like they’ve dug far enough.

“I think we have reached the point of diminishing returns,” said Bradford, “I think we need to accept the stipulation and move on.  We’ve done our due diligence trying to find where this money could have gone, and is there any chance that we could get it back.”

The measure to accept the settlement passed unanimously.  Trustee members joked that they hope she wins the lottery.

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