Clallam County offered $597,516 insurance settlement in alleged embezzlement

PORT ANGELES — Clallam County has been offered a $597,516 insurance settlement to cover most of its losses from a former employee’s alleged embezzlement, Treasurer Judy Scott said Thursday.

That calculates to 96.8 percent of the amount of real estate excise tax that a state Auditor’s office investigation said could be proven to be missing.

“I’m just happy it’s coming to fruition,” said Scott, who is running for re-election in the Nov. 2 general election.

The three Clallam County commissioners on Monday will consider whether or not to authorize County Administrator Jim Jones to execute the settlement.

If approved, the county expects to receive the funds in 7-10 days.

“It’s in the works,” Scott said.

A state Auditor’s Office investigation concluded that a former treasurer’s office employee stole at least $617,467 in public funds from a county cash drawer over a five-year period.

Catherine Betts faces a Jan. 10 trial in Clallam County Superior Court on an aggravated first-degree theft charge.

An internal investigation by county accountant Jen Santos found that $611,485 had been taken between February 2004 and May 2009.

Great American Insurance Co. officials reviewed both investigations and accepted $607,516 of the sum.

The difference in the numbers stems from a lack of original source documents to prove that every alleged fraud transaction was fraudulent.

A $10,000 deductible brought the final settlement offer to $597,516.

“I think its a good settlement,” Scott said.

Immediately after receiving the fund, the county will wire the money — in full — to the various agencies where it should have gone in the first place.

“The deductible will come out of the county’s share of the money,” Jones said.

Scott and Jones agreed that Santos did a good job providing sufficient information to the insurance company.

“I thought we did well,” Scott said.

The embezzlement is the fifth-largest theft of public funds from a government agency in the state in the past decade.

The money has never been recovered.

Betts allegedly covered up a checks-for-cash fraud by altering and destroying real estate excise tax records, the state investigation found.

After pleading not guilty, Betts was released on her own recognizance and lives in Shelton.

As soon as the county receives the settlement, the revenues will be passed on to the state, the Clallam County capital projects fund and the cities of Port Angeles, Sequim and Forks.

The settlement breaks down as follows:

• $345,769 to the Clallam County capital projects fund.

• $199,387 to the state Department of Revenue.

• $34,304 to the city of Port Angeles.

• $13,271 to the city of Sequim.

• $4,640 to the city of Forks.

• $145 to the state for a technology fee.

Scott’s election opponent, Clallam County Senior Planner Selinda Barkhuis, has hammered on the embezzlement case during the campaign.

Barkhuis told Port Angeles Rotary Club members on Wednesday that Scott could have discovered the missing money within months of taking office in 2005 but didn’t, and that Scott had a “fiduciary duty” to safeguard public funds.

Barkhuis cited the $60,067 cost of the state investigation during the political forum.

Scott, however, said the cost was revised to $28,718 in April.

The commissioners’ work session on Monday will begin at 9 a.m. in Room 160 at the county courthouse, 223 E. Fourth St., Port Angeles.

________

Reporter Rob Ollikainen can be reached at 360-417-3537 or at rob.ollikainen@peninsuladailynews.com.

More in News

Lost Mountain Station 36 at 40 Texas Valley Road recently sold to a neighbor after Clallam County Fire District 3 was unable to recruit volunteers to staff the station. Its proceeds will go toward future construction of a new Carlsborg Station 33. (Matthew Nash/Olympic Peninsula News Group file)
District sells one fire station

Commissioners approve 2025 budget

Clallam County Master Gardener Gordon Clark cuts leaves off Isobel Johnston’s agave plant that she had been growing for 28-plus years. She specifically requested Master Gardeners help her remove the plant while keeping at least one for years to come. (Matthew Nash/Olympic Peninsula News Group)
Master Gardeners help remove agave plant on Fifth Avenue

Several baby plants uncovered below large leaves

Harvey Hochstetter tosses a box of food to Cameron Needham to stack with fellow volunteers like Bill Needham, right, for the Sequim Food Bank’s Holiday Meal Bag Distribution event. Cameron, his father Ty and grandfather Bill were three generations helping the program. (Matthew Nash/Olympic Peninsula News Group)
Sequim Thanksgiving program helps 1,200 families

About 30 volunteers pack holiday boxes

Security exercise set at Indian Island

Naval Magazine Indian Island will conduct a security training… Continue reading

Operations scheduled at Bentinck range this week

Training at the land-based demolition range on Bentinck Island… Continue reading

Weekly flight operations scheduled

There will be field carrier landing practice operations for aircraft… Continue reading

Janet Lucas, left, finds a special purchase of a “mail manager” at Swains early Friday morning. Black Friday shoppers descended on the Port Angeles store at 8 a.m. There were dozens of early risers who went looking for special bargains on one of the biggest shopping days of the year. (Dave Logan/for Peninsula Daily News)
Black Friday

Janet Lucas, left, finds a special purchase of a “mail manager” at… Continue reading

Clallam adopts housing needs

Population projected at 86,700 by 2045

The Wall That Heals, a Vietnam War memorial, coming to Port Townsend

Opening ceremony to be held at Jefferson County airport on Sept. 11

Sherry Phillips, chair of the Festival of Trees design committee, stands next to the tree Twelve Days of Christmas, which she designed personally. (Leah Leach/for Peninsula Daily News)
Port Angeles woman shares joy of decorating trees

Sherry Phillips lends talent for all of festival’s 34 years

EYE ON THE PENINSULA: Public hearings set on proposed 2025 budgets

Meetings across the North Olympic Peninsula

Serving up a Thanksgiving meal are, from left, Taylor Hale, Gina Landon, Shawn Lammers, Ryan Lammers, Sara Taylor and Jean Ball, all volunteers with Holiday Meals, located in the Tri-Area neighborhoods of Chimacum, Port Hadlock and Irondale. The group expected to serve up to 460 full Thanksgiving dinners with 287 being picked up, 118 delivered and 55 eaten at the Tri-Area Community Center. (Steve Mullensky/for Peninsula Daily News)
Thanksgiving meals kick off holiday joy

Smiles, warmth light up Queen of Angels Catholic Church