Investigation of Clallam treasury theft goes on, but action in courtroom stalls

PORT ANGELES — A status hearing four months before the trial of former Clallam County employee Catherine Betts on an aggravated first-degree theft charge was unproductive Thursday.

Meanwhile, Port Angeles police continue to attempt to track down what happened to the $617,467 in public funds that Betts is alleged to have stolen from the Clallam County Treasurer’s Office.

On June 10, Clallam County Superior Court Judge S. Brooke Taylor moved Betts’ felony trial on a charge of aggravated first-degree-theft from July 12 to Jan. 10, 2011 — almost two years after the theft was discovered — so Clallam Public Defenders could hire forensic experts to examine more than 60,000 pages of financial documents related to the theft.

Public defender Loren Oakley told Taylor on Thursday that no experts have been hired.

“We are still in the process of evaluating the case and seeing how we are going to pursue that,” Oakley said.

“Wouldn’t it help to have an expert on board to do that?” Taylor responded.

Taylor set another status hearing for 1 p.m. Nov. 18 and said he expects experts to have been hired by then.

Betts, who has pleaded not guilty, participated in the hearing by speaker phone from Shelton, where she returned after being released on her own recognizance. She is in a wheelchair and finds it difficult to travel, Oakley said.

Oakley told Taylor he keeps receiving new information from the prosecution on CDs, which can contain voluminous amounts of data.

As of Thursday, police don’t know what happened to the funds alleged to have been stolen, Police Chief Terry Gallagher said.

“There is nothing significant that has occurred in this case in at least the last month,” he said.

“We follow leads in an effort to determine where the money may have gone, but those efforts are not always successful.

“Our path at this point would primarily be to follow the direction of the [Attorney General’s] Office,” Gallagher explained.

“If they were to ask us for specific work on a specific aspect of the case, we would do that.”

The county will at least recover the amount stolen through its insurance policy, county Administrator Jim Jones predicted Thursday.

A Great American Insurance Group of Cincinnati representative told Jones in July that the county is “completely covered” for the theft.

“They are attempting to do everything they can do to find out how to recover as much of the money they possibly can,” Jones said.

“If the court can’t do it, then they will try to do it civilly.”

Great American Insurance Group officials could not be reached for comment late Thursday.

After a nine-month investigation, state Auditor’s Office investigator Jim Brittain concluded in February that Betts stole $617,467 in a cash-for-checks scheme involving real estate excise taxes between Feb. 1, 2004, and May 19, 2009 — and that the exact amount stolen could not be determined.

“The county did not monitor this activity,” Brittain said.

Taylor has allowed Public Defenders to classify the Betts case as requiring an “extremely complicated defense,” meaning Public Defenders can spend funds on the Betts case outside the $840,000 contract it has with the county to represent indigent defendants, Jones said.

Harry Gasnick of Clallam Public Defenders said Thursday “it’s premature” to speculate if Public Defenders will receive money outside its contract for defending Betts.

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Senior Staff Writer Paul Gottlieb can be reached at 360-417-3536 or at paul.gottlieb@peninsuladailynews.com.

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