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Audit of Carroll County Ambulance District uncovers possibly criminal conduct

Carroll County Ambulance District.jpg
Posted at 2:16 PM, Nov 23, 2022
and last updated 2022-11-23 15:16:23-05

KANSAS CITY, Mo. — A whistleblower complaint by its board of directors led to the discovery of more than $90,000 in misappropriated funds from the Carroll County Ambulance District, according to a report from the Missouri State Auditor’s Office.

The state auditor's report gave the ambulance district its lowest possible rating, poor, after finding that $91,794 was misappropriated during a 10-month span from June 1, 2020, through March 31, 2021.

The findings included $54,530 in payroll overpayments and $1,945 in questionable mileage reimbursements paid to the former director, Mario DeFelice.

According to the report, DeFelice also “improperly authorized” 19 payroll overpayments, which totaled $29,560 to 15 district employees.

He also misappropriated $4,021 from an employee benefit reimbursement account and charged $108 to a district credit card for personal use.

Missouri State Auditor Nicole Galloway recommended that the Carroll County Ambulance District Board of Directors “work with law enforcement officials regarding criminal prosecution of the improper overpayments, questionable and improper reimbursements, and improper purchases, and take the necessary actions to obtain restitution.”

The Missouri State Highway Patrol has not launched an investigation, a spokesman for Troop A told KSHB 41 News, and Carroll County Sheriff Jewell McCoy also said he wasn’t aware of an investigation, which he indicated would be performed jointly with the highway patrol.

Carroll County is located about 70 miles northeast of the Kansas City area.

Galloway’s office, which announced its probe in March 2022 at the request of the board, determined that the board had some responsibilities for the misappropriation of funds due to its lax oversight of DeFelice.

“The audit identified inadequate oversight by the board of directors over the former director and insufficient segregation of duties over the various financial accounting functions,” Galloway’s office said in a statement. “The board did not adequately monitor the district's payroll and disbursements activity, which enabled the misappropriation by the former director.”

DeFelice declined repeated requests from the state auditor’s office for an interview, saying “report whatever you want to and I will deal with it at a later time” in a July 12, 2022, email, according to the 31-page report.

The auditor’s office found that DeFelice “added hours to other district employee time records” and misappropriated nearly $55,000 in overtime, retention and holiday pay to himself without board authorization.

DeFelice paid himself for working as a paramedic when other staff wasn’t available, but had refused to sign an employment contract. He did not provide time records or summaries to the board for review, so the excessive overtime — impermissible for his salaried position, which paid DeFelice $75,000 annually — wasn’t discovered “until after his termination,” the auditor’s report said.

He also paid himself a $15,000 retention bonus in December 2020 and paid himself 96 hours of holiday pay, recording 24 hours for Thanksgiving and Christmas and 48 for New Year’s Day despite the fact he was not scheduled to work and didn’t perform any ambulance runs on the holidays.

DeFelice tried to pay himself $23,068 for the final pay period before his termination, but the former business office manager denied that payment.

There was no documentation for the nearly $2,000 in mileage reimbursement, which was paid at a higher rate than the IRS allowance using a form DeFelice created himself. The former business manager denied another mileage reimbursement request for $560 for an online training shortly before his termination.

Carroll County residents expressed their unhappiness with the direction DeFelice was taking the ambulance district at an October 2020 meeting after two longtime EMTs were abruptly fired two months earlier.

DeFelice also courted controversy with a flap over CARES Act COVID-19 relief funding in November 2020, according to KMZU, and by refusing service to Carroll County hospitals amid staffing shortages.

The state auditor’s office recommended that the board change its accounting procedures to tighten “review and monitoring” controls.

Carroll County Chiefs of EMS Joe Campbell said new procedures already have been implemented and the auditor’s report noted several changes the board has adopted since new leadership took over for DeFelice, who served as director from June 2020 until March 2021

The Missouri Attorney General’s Office previously sued the Carroll County Ambulance District in April 2021 for violating the state’s Sunshine Law with respect to meeting notices, closed-meeting discussions, and minimum agenda requirements.

The auditor’s report cites Sunshine Law violations by the board for failing to maintain minutes and record the result of votes among other issues.