A new state audit released Jan. 10 cites the City of Homewood for a“lack of or ineffective management oversight” of city finances that led to the embezzlement of nearly $1 million.
The Alabama Department of Examiners of Public Accounts reports that lack of oversight “provided an opportunity for unauthorized expenditures.”
The former finance director for Homewood, Robert Winston Burgett, pleaded guilty Oct. 23 to embezzlement of nearly $1 million from the city.
Homewood officials say the city was the to first to uncover suspicious movements of city funds after Burgett retired as finance director in March 2024 and immediately reported them to local, state and federal authorities.
While an FBI investigation continues, Burgett is now awaiting sentencing after pleading guilty to three federal charges of wire fraud. Insurance has covered $500,000 of the more than $947,000 that Burgett illegally transferred into his personal accounts. The city is working to recover additional monies, officials said.
According to the audit, Burgett attempted to embezzle more than $1.8 million, but succeeded in embezzling $947,059.46.
The city has responded to the audit with a statement outlining its actions to correct policies and practices that allowed the theft to occur.
“The city of Homewood has reviewed the Limited Special Review by the Alabama Department of Examiners of Public Accounts of the city’s financial system concerning both the use of city credit cards and a separate fraudulent misappropriation of funds by a former city employee,” it said. “The city was the first to discover both issues and quickly began taking steps to improve Homewood’s oversight of its accounting system.”
Updates to credit card, finance polices
Homewood Mayor Alex Wyatt said the city has taken measures to restore trust.
“Just after we initiated our deeper dive and discovered troubling shortcomings in the control of city finances, we started the process of strengthening our policies,” Wyatt said. “We have already met with the state examiners and appreciate their work because their recommendations will help us continue our efforts to make sure our finance department works more securely so that expenditures of public funds are properly tracked in strict adherence to sound business and audit standards.”
In October 2023, the city council started a review of the use of city credit cards by city employees after possible irregularities were uncovered.
The city is conducting a review of an outstanding financial obligation of approximately $1,300 by an employee. Burgett also had almost $10,000 in disputed credit card charges.
Substantial personal reimbursements have already been made to the city. Both credit card cases are being referred by the state auditors to the Alabama attorney general for collection.
In November 2023, the city council voted to strengthen policies on the use of city cards, which include:
- A reduction in the number of cards in use.
- Cards can only be used for official, pre-authorized, city expenditures and not for any personal expenditures, cash advances, or alcohol purchases.
- Cards can only be used for eligible travel costs, including conference registration and associated fees, lodging and transportation. Meals are limited to $75 a day with fully itemized receipts.
- Cards are not intended for purchases that can be made via normal purchasing procedures, except for emergencies or purchases personally authorized by a department head or the mayor.
- Card purchases will be audited by the finance department on a monthly basis.
- Infractions of the credit card policy can lead to disciplinary action and recovery of funds through a reduction in employee paychecks.
Changes to local government
In September, in an effort to add more professional oversight of the city, local voters approved a new form of government. A city manager will take over chief executive duties in November 2025. The city has already started a search for an interim manager, who could start in March.
“A full-time city manager will bring an experienced professional in public administration with budget management skills and significant supervisory experience to the city,” said Walter Jones, president of the Homewood city council. “This is a meaningful step as the city council continues to review financial issues to assure that taxpayer dollars are correctly spent in an accountable manner.”
