UPDATED: JPD responds to Comptroller's report of investigation into missing, mishandled money

An investigation into the Jackson Police Department by the Tennessee Comptroller’s Office was released Friday morning, drawing attention to “questionable cash-handling practices” within the Jackson-Madison County Metro Narcotics Unit’s (JMCMNU) seizures and forfeitures going back as far as 2018.

A Jackson Police Captain at the center of the investigation used a safe located at the Jackson Police Department to “temporarily store funds in her custody” until she could make a bank deposit in the City of Jackson’s bank account.

The Jackson Police Department's safe at the center of the comptroller's investigation.
The Jackson Police Department's safe at the center of the comptroller's investigation.

An inventory of the safe conducted by investigators on March 5, 2021 revealed that $399,531.26 was inside—and according to the findings, some of the money had been in the captain’s custody and control since July 2019.

The money consists of government contributions, fines, grant proceeds, seizures, and forfeitures that are used for unit-related purchases, activities and more, including drug enforcement operations, drug education, drug treatment programs, and nonrecurring general law enforcement expenditures.

According to state law, all municipal funds must be submitted to their official bank account no later than three working days after being received.

After discovering that the captain was storing the massive amount of cash in the safe and had not made any deposits to the official bank account “for some time,” JMCMNU management performed an inventory of the contents of the safe.

Investigators found discrepancies surrounding at least $15,027.50 in seized money, settlement proceeds and various payments, including a missing $6,639 that investigators confirmed the captain had received but could no longer account for.

This was determined based on evidence form and property receipts, which listed the captain as the last custodian of the funds. However, the captain “could not provide any documentation” that the funds were ever deposited to the official bank account, and the Revenue Office had no documentation associated with these transactions.

Following the meeting with investigators, the captain found $1,088.50 reportedly in four overlooked envelopes “laying under some paperwork” in the safe.

Later, the captain found and deposited money and money orders after the March 5th inventory that totaled $7,300.

According to the comptroller’s findings, “investigators question the whereabouts of this money that was in her custody and control prior to and during the March 5 inventory. The captain claims the money was located either at the impound lot or under her computer monitor.”

During an interview with the captain on Aug. 23, 2021, the captain claimed that she “did not steal, borrow, or put back any money,” and that she turned in “every penny” that she ever collected.

She also stated that she had indeed remitted all of the money, and could not explain why the Revenue Office had no record of all of these transactions.

Some transactions were made within these time periods, however.

On March 19, 2021, the captain deposited $3,500 into the official bank account—funds that had been in her custody since Sept. 18, 2020. According to investigators, the captain “could not remember the exact circumstances,” but stated the cash could have been kept in the seizure file at the impound lot. She added that she thought she pulled the case file out to “look at items to auction and found the envelope with the money.”

On the same date, the captain also deposited $2,000, which had come into her possession on Nov. 20, 2020. She stated that she had placed the envelope with the money under her computer monitor, and she overlooked it and did not find it until March 2021.

On May 3, 2021, a deposit of $1,800 in money orders was made, which the captain later said were in a seizure file at the impound lot, and that she “did not remember them until she found them later.”

The comptroller’s investigation states that the discrepancies constitute “excessive and unreasonable delays between the date of seizures and the date the money was ultimately deposited into the official bank account.”

According to investigators, money was not picked up from the MCSO drop box up to seven days after its deposit, then would be retained in the MSCO money vault for up to 108 days, and finally retained in the JPD safe prior to depositing in the bank for up to 609 days—far, far exceeding the three-day limit.

The captain states that due to COVID-19 related limitations, she could not use the bank drive-through, which accounted for some of the delays. However, the evidence shows excessive delay prior to 2020.

The captain also claimed that she had “needed additional time to verify the accuracy of seizures prior to depositing the funds into the bank,” and leadership had not responded to her requests for assistance.

However, investigators were unable to substantiate these claims.

Issues were also found with the JMCMNU impound lot.

Property seized by JMCMNU retained at the impound lot.
Property seized by JMCMNU retained at the impound lot.

On Aug. 12, 2021, investigators visited the lot to inventory and confirm selected properties seized by JMCMNU in relation to the investigation.

According to investigators, while all properties selected for review were found, a few major problems were discovered.

Most importantly, there was no “uniform or reliable system in place to store, organize, label, and locate properties.” There was also no system in place ensuring “clear and distinct custodianship” of the properties between personnel, and properties that were already deemed unserviceable or had already been awarded to JMCMNU were kept at the impound lot without an attempt to dispose of them in a timely manner.

The comptroller’s office performed an investigative audit of JMCMNU operations in 2005 as well, and a report in 2006, revealing similar findings and weaknesses regarding seized money.

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According to investigators, these issues “represent root causes that contributed to money discrepancies found under the captain’s oversight and control.”

JMCMNU officials indicated to investigators that they have corrected, or intend to correct, these deficiencies.

The official findings of weaknesses from the comptroller’s office are:

  • Lack of segregation of duties

  • Lack of documentation identifying amounts deposited

  • Lack of tracking mechanism

  • No periodic reconciliation between JMCMNU and the Revenue Office

  • Evidence of money erroneously deposited to the official bank account

  • Outdated JMCMNU procedure manual

  • Inconsistent and noncompliant processes by JMCMNU investigators

  • Inadequate document retention practices

  • Weaknesses at the impound lot regarding custody and disposition of seized property

The results of this investigation have been communicated to the District Attorney’s office.

The Jackson Police Department released a statement regarding the investigation Friday afternoon:

"In the Jackson Police Department’s continued efforts of building and maintaining trust with the citizens we serve, we acknowledge the Comptroller of the Treasury report that was recently released. Public trust is a valuable commodity and is of the upmost importance for our daily operations as an agency.

"When the administration was made aware of concerning issues involving seized Metro Narcotics funds, the District Attorney’s Office was contacted for guidance. Based upon the recommendation of the District Attorney’s Office, we supported the Comptroller’s Office being contacted to perform an investigative review. Jackson Police have fully cooperated with the assigned investigators throughout the investigative process.

"However, several months prior to this finalized Comptroller Report, Jackson Police conducted its own Administrative Review. Based upon the Administrative Review, personnel were reassigned, procedures were revised, and discipline was administered. The implementation of the newly revised procedures, to include working with the city’s internal auditor, were implemented to ensure a proportionate degree of redundancy for oversight and the reassignment of personnel was to oversee the process.

"With the implementation of the new procedures and the recommendations of the Comptroller’s Investigative Report, the Jackson Police Department will be proactive in ensuring transactions are being handled by established guidelines. Also, in continued partnerships with the District Attorney’s Office and the Office of the Comptroller of the Treasury, Jackson Police are committed to doing it the right way and protecting the interest of the citizens of the City of Jackson and Madison County.

"As we have addressed the issues highlighted in the Comptroller’s report as well as our own administrative review, the department will allow the merits of the report to stand and decline any further requests for comments."

Have a story to tell? Reach Angele Latham by email at alatham@gannett.com, by phone at 731-343-5212, or follow her on Twitter at @angele_latham.

This article originally appeared on Jackson Sun: Money missing, mishandled at JPD, comptroller's investigation finds