Park District Workers Pocketed Cash From Scrap Metal Sales, Set Up Tax-Exempt Sam's Club Accounts, Inspector General Finds
CHICAGO (CBS) -- Several Chicago Park District employees are facing disciplinary action and might be fired after allegedly selling scrap metal for more than $64,000 in cash, which they never turned over to the district. Another group of current and former employees is accused of setting up Sam's Club memberships using the district's tax exempt status.
The investigations were detailed in Park District Inspector General Will Fletcher's first quarter report, which also revealed an administrative worker was hired without verifying that the employee had the required bachelor's degree, and another staffer falsified documents to certify a friend had completed court-ordered community service.
An investigation by Fletcher's office discovered 11 employees sold Park District scrap metal for cash between 2012 and 2017, rather than taking payments by check as required by policy. Nearly 300 combined transactions amounted to $64,000 in cash that was never turned over to the Park District.
According to the inspector general's office, two employees were responsible for the bulk of the illicit transactions, amounting to $44,000 that never made it to the Park District. Those employees denied taking any of the money for themselves, claiming they gave it to a now-retired foreman and that they didn't know what the foreman did with the cash.
During the same time span, the Park District received only $19,634 in scrap metal payments by check.
Fletcher's office recommended the two employees responsible for most of the missing cash be fired and that the Park District tell scrap metal vendors to pay it for scrap metal exclusively by check.
The district has moved to fire the two employees and has initiated disciplinary proceedings for the other nine who took cash they never turned over to the district.
In another investigation, Fletcher's office found 24 Sam's Club memberships had been set up using the district's tax exempt status, allowing the individuals who created those accounts to avoid paying sales taxes.
Seventeen of those 24 accounts were set up by current or former Park District employees. The others involved were never employed by the district.
Three supervisors allegedly used the tax exempt memberships to purchase thousands of dollars of merchandise between 2015 and 2019. Those employees insisted some of those purchases were made for the Park District but admitted most were for personal items.
The inspector general's office said the employees claimed they didn't know their personal purchases were not taxed, even though Sam's Club requires customers to confirm they are making a tax-exempt purchase for all such transactions.
One employee purchased more than $14,000 of merchandise from Sam's Club, most with a tax exemption; another purchased approximately $9,300 of goods, mostly tax-free; and the third bought items worth more than $2,800 without paying taxes.
The inspector general recommended those three be required to retroactively pay any sales taxes they owed on those purchases and urged the Park District to take disciplinary action for all current employees who made unauthorized tax-exempt purchases. It also advised the Park District to restrict access to its tax-exempt letter and to have Sam's Club cancel the 24 tax-exempt accounts.
A third investigation determined the Park District hired a full-time administrative employee without requiring proof the worker had a bachelor's degree required for that position, even though the inspector general had already found red flags in the candidate's application – including an incomplete transcript and a listed graduation date of 01/9999.
The employee involved resigned after the inspector general recommended the worker be fired.
Finally, an inspector general's investigation revealed a Park District worker submitted falsified documents to a downstate court, verifying a friend had completed 100 hours of court-ordered community service following a felony conviction for theft and forgery.
That employee has been fired.
