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The Journal Gazette

Wednesday, November 04, 2015 8:52 am

AG sues ex-purchasing agent to recover more than $27K in public funds

The following was released on Wednesday, Nov. 4, by the Indiana Attorney General's Office :

FORT WAYNE, Ind. – Attorney General Greg Zoeller’s office today filed a civil lawsuit against the former purchasing agent of Fort Wayne Community Schools, seeking repayment of school funds that the former official allegedly used to fraudulently pay personal expenses such as groceries, utility and telephone bills and electronic merchandise.


Named as a defendant in the lawsuit the AG’s Office filed today in Allen County Circuit Court is Patty Coffelt, the former purchasing agent for the Fort Wayne Community Schools. The lawsuit seeks repayment of the amount allegedly embezzled from the school plus state investigative costs – totaling $27,458.74 – as well as treble damages, attorneys’ fees and court costs.


A State Board of Accounts special investigative audit report issued Sept. 10 found that between January 2012 and December 2014, Coffelt allegedly misappropriated $13,729.37 from Fort Wayne Community Schools. As a school purchasing agent, Coffelt was issued one of the school procurement cards, which are similar to credit cards, for use in making school-related purchases. The audit found that on 30 occasions, Coffelt illegally used the school procurement card to pay for personal expenses, such as groceries or telephone and utility bills.


Coffelt oversaw her school procurement card bills, but when she was on leave, another employee substituting for her discovered Coffelt’s improper charges to the card, the audit stated. Once alerted to the misappropriation, the Fort Wayne Community Schools then notified the State Board of Accounts, which initiated a special investigation. SBoA examiners identified multiple instances where Coffelt ran up unauthorized charges on the school card, the audit stated.


Among the unauthorized amounts were $9,335.21 in purchases paid for with special education funds for items the school special education department never requested nor received, the audit said.  Coffelt also purchased six notebook computers using school funds for $349.99 each but turned over only five to the school and kept one for herself, the audit said. In the special audit, the State Board of Accounts calculated the misappropriated amount as $13,729.37 and requested repayment to the school.


“It is disheartening that a school employee entrusted with taxpayers’ hard-earned money intended for special education would instead misuse and embezzle those funds, as the audit alleged. My office will make every effort to recoup misappropriated funds from this defendant who is accused of violating the public trust and return that money to the school treasury so it can be used for the education of students,” Zoeller said.


When the State Board of Accounts conducts an audit of a local unit of government and discovers public funds have been misappropriated, the SBoA refers the matter to the Attorney General’s Office.  As the state’s collection agent, the AG’s Office seeks to recover public funds and return them to the local unit, often through filing civil lawsuits against the defendants responsible. If the courts enter civil judgments, then the Attorney General’s Office can use the same collection methods any creditor can use against a debtor to collect on a debt, such as placing liens on defendants’ real estate and personal property and garnishing wages and bank accounts.

Because of the time and effort necessary for examiners to reconstruct the unauthorized purchases from the available records, the State Board of Accounts also seeks reimbursement from Coffelt of its investigative costs of more than $13,000 in addition to the underlying amount misappropriated. The state’s lawsuit seeks a total $27,458.74.


The Attorney General’s Office’s jurisdiction is civil only.  Criminal charges, if any, are solely the jurisdiction of the county prosecutors in each county or U.S. Attorney’s Office. Coffelt has been criminally charged by the Allen County Prosecutor’s Office with felony theft in the scheme, and awaits trial on those charges March 10, 2016, in Allen County Superior Court 5.


In light of the volume of State Board of Accounts audits of local units that discovered misappropriation – approximately 250 between 2009 and 2014 – Attorney General Zoeller last year created the Public Integrity Coalition to study the misuse of public funds and recommend ways to prevent and deter it.  The coalition’s members include associations for officials serving in county and municipal governments, townships and schools, as well as a state legislator, federal prosecutor, the state examiner and the Attorney General.


The Public Integrity Coalition has held a series of training sessions for public officials and local government employees around the state on proper internal accounting controls and ethical practices.  The coalition also recommended a package of legislation that the Indiana General Assembly considered and passed during its 2015 session.  Among other things, the newly-passed laws give legal protections to whistleblowers who report their suspicions about misappropriation of public funds by their colleagues or supervisors.  More information about the Public Integrity Coalition is at this link: More information about the coalition’s legislation is at this link:



NOTE:  The State’s complaint to recover public funds filed today against Patty Coffelt in Allen County Circuit Court is attached. The State Board of Accounts special investigative audit report of Fort Wayne Community Schools dated Sept. 10 is at this link: