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Apr 2, 2013 3:28 PMPublication: The Southampton Press

Cover Letter Appears To Be Cause Of Confusion With Westhampton Beach Village Audit

Apr 3, 2013 12:33 PM

A three-page summary letter attached to an audit shared last month with the Westhampton Beach Village Board, but not the outside attorney hired to oversee the financial examination, is apparently what prompted the lawyer to accuse certain board members—namely, Mayor Conrad Teller—of tampering with the document so that it better reflected village finances.

The mayor, who has refused to share his copy of the summary letter even though he says it is now voided, said it was designed only to help village trustees digest the information contained in the 300-page audit that still has not been adopted by the board. Mr. Teller, who also declined to say what the three pages contained, acknowledged when being questioned last month by Scott Augustine, the outside attorney hired by the board to oversee the audit, that he had contacted Satty, Levine & Ciacco, the village’s auditing firm, just prior to the company forwarding the finalized document to the trustees.

Mr. Augustine, who has not returned calls over the past two weeks, abruptly left last month’s board meeting after strongly insinuating that someone on the board had manipulated the final report because his version of the document—which he received from the auditing firm at least a week before the trustees—contained fewer pages. At the time, he said someone on the board had the report altered so that it better reflected the village’s financial state, though he also refused to explain how that was accomplished. The audit was requested after a payroll error was discovered last year; the mistake has since been corrected, according to the mayor.

Mr. Teller this week insisted that the village’s finances are now in order—for the most part.

“It is a rehash of the report,” Mr. Teller said of the now discarded document. “It is the compilation of all the information they got from our records concerning the payroll error, and the payment of the monies outside of the contract on a couple of people. It’s the things they weren’t clear on.”

Village Trustee Patricia DiBenedetto confirmed that the three-page summarization has since been repealed by the auditing firm. She also declined to share its contents.

“There was a three-page addendum that was drafted that wasn’t part of the initial report,” Ms. DiBenedetto said. “But that has been rescinded by the auditors. It is still being addressed by legal [counsel], and we are close. We are almost finished at this point.”

John Lundy, the CPA with the auditing firm Satty, Levine & Ciacco that prepared the report, has not returned calls seeking information about the discrepancy or what prompted his firm to add the summarization report.

Village Trustee Ralph Urban, who also declined to share his copy of the summarization or discuss its contents, said the cover letter was the only item missing from Mr. Augustine’s version of the audit. Mr. Urban also said the summarization has since been tossed by the firm, though he said he saw no apparent discrepancies between it and the audit.

“The report is very detailed,” Mr. Urban said. “I didn’t see any discrepancies myself, but that doesn’t mean there wasn’t any.”

Deputy Mayor Hank Tucker, who has pushed for the audit of village finances, has not returned calls over the past two weeks. Trustee Charlie Palmer also has not returned calls.

Mr. Teller, meanwhile, is insisting that the information contained in the tossed summarization does not change the facts of the financial investigation.

“The analysis of the entire document consisting of three pages [and] dated March 5 was erroneous and they will be out to discuss it verbally,” Mr. Teller said, referring to officials with Satty, Levine & Ciacco, who will make a presentation to the board and discuss their findings at a later date. “It was an error in producing it, not in content.”

He said he cannot discuss the contents of the cover letter until trustees discuss the audit in executive session with Mr. Augustine, village labor attorney Richard Zuckerman and Mr. Lundy.

The audit, which still has not been adopted by the board, is the last outstanding examination in a string of financial reviews that have focused on village finances since October. The decision to turn the microscope on village finances came after an accounting error made by Village Clerk Rebecca Molinaro, who recently accepted a new post in East Hampton Village, resulted in the village’s 34 full-time employees being overpaid by $22,000 total. She starts her new post in May.

In October, the trustees hired Mr. Augustine to come in and review certain aspects of village finances. At the same time, Mr. Teller requested an audit from the state comptroller’s office; state officials have already reviewed the village’s finances and have found no red flags, according to Mr. Teller.

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