But a few weaknesses that allowed the theft of hundreds of thousands of dollars from the Weber School District Foundation do exist at some other foundations and must be addressed. However, the risk may be far more minor. A sampling of districts and foundations was reviewed for this report.
Late last year, Utahns learned of the first of several alleged embezzlement schemes. In that case Davis district employees Susan G. Ross and John D. Ross of Layton are accused of stealing $4.3 million through an alleged book-purchasing scam. Susan Ross' secretary, Stella V. Smith, is charged in a separate theft involving more than $300,000 for allegedly submitting fake bills for textbooks that were neither ordered nor delivered.
The Ross couple and Smith await jury trials.
In the second case, Denise Aughney, a former Weber foundation secretary, pleaded guilty in April to embezzling more than $1 million in donations. She has admitted to forging checks and placing foundation dollars in her accounts. "District management believes the theft may have started as early as 1994 when she was first hired to work for the foundation," the audit states.
The potential for fraud increased in Weber because the same person who issued checks could record check details, according to the audit. District foundations solicit money from private donors to pay for school programs and materials. Communication is needed between the foundation and a district's schools, the audit showed.
"One reason theft at the Weber foundation was not noticed was because schools did not know about the transactions, such as checks supposedly issued for their benefit," the audit states. Weber will now send each principal a quarterly report on the school account.
"You're looking at a situation where the state auditor was right on . . . that was a weakness and it was fixed," said Chris Zimmerman, the foundation's new executive director. A former chief deputy for the Weber County Sheriff's Office, he supervised the detective who investigated the foundation embezzlement.
The audit states that of six other school district foundations reviewed, Granite and Jordan districts had at least a few schools that were unaware of all the details of the balances in their foundation accounts, the audit states.
Foundations are in need of more oversight and guidance, the audit found.
Davis School District discovered the alleged embezzlement with the help of a part-time internal auditor, which is something all districts could benefit from, the audit states. It suggests that the Utah State Office of Education review the possibility of having an auditor do internal auditing for several small districts.
More oversight by the state office that oversees federal Title I funds for disadvantaged students also would be beneficial.
The Rosses are accused of stealing Title I money.
"We feel an analysis of unusual spending patterns could have resulted in additional scrutiny and subsequently detected the alleged frauds . . .. Had the USOE Title I department also monitored expenditures and evaluated those that appeared atypical, the allegedly fraudulent purchases may have been discovered and dealt with many years ago," the audit states.
In the past two years, the Davis district has taken and continues to take steps to improve its financial oversight, officials say.
Its computerized purchasing system now prevents one person from placing and approving the same order, among other changes. Principals monitor their schools' Title I programs and decide what to purchase.
A conflict of interest and ethics statement is now being signed by district employees, which is unique in the state, according to Bruce Williams, Davis' business administrator.
"Currently our internal controls are as strong or stronger than any district in the state of Utah," he said.
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* JULIA LYON can be contacted at jlyon@sltrib.com or 801-257-8748.
