In documents by The Morgan County News obtained through a Government Records Access Management Act (GRAMA) request from the investigation into the actions of Garth Day, the former Morgan County Council Administrator, additional details of the actions of Day were revealed.
They also indicate that Day confessed to wrong doings and is cooperating with the investigation. The investigation documents confirm previously reported details surrounding the actions of Day and add additional information.
The investigation tells of the events indicating that Day contacted County Council Chairman Sid Creager on August 27, 2010 to report that he “had done some bad things.”
This call from Day was after Creager requested that Day set up a meeting with Chase Bank to discuss concerns over an account that had been opened for Morgan County. Day did not set up the meeting as requested, and Creager repeatedly called Day that evening and the next morning.
Day returned the call the following afternoon about 2 p.m. and informed Creager that he had met with his attorney and confessed his actions. “He told Sid that they, the council, should distance themselves from him and should either place him on un-paid administrative leave or fire him immediately.”
The things that he has done will most likely cost him his marriage, home, and will do jail time. Creager asked what kind of risk was there to the county and Garth said he had taken about $200,000.
Day indicated that he was going to fully cooperate, give a full disclosure, and not fight any charges.”
According to the report Creager inquired of Day whether any of the funds would be recoverable and Day replied, “some funds may be in a fraudulent account that he had with Centennial Bank but the bank was now under FDIC control.”
Bonnie Thomson, Morgan County Treasurer, had expressed concern previously over items that seemed irregular to her.
One of the items Thomson had been checking related to the account set up for the $1.5 million road bond. She had stopped receiving a bank statement for this account. When she obtained the statement she noticed two large draws from the County account. The first of $400,000 had been received by the county and deposited into the county’s regular bank account.
The second draw of $265,000 had not been received at the county. When asked about the check Day communicated that the funds had been placed in a separate account for a UDOT match.
Inquiries by Thomson did not result with success in finding the funds. Day then provided the name of Alex Baker and gave her a contact number. Thomson contacted Baker who confirmed the transaction. The investigation determined that Day purchased a cell phone and posed as Alex Baker in the conversation with Thomson.
Shortly after this interaction Thomson received two memos from Day. This first was a memo to Alex Baker (Day’s alias) to close the account in question and the second was to Lynn Wood to request an independent audit. Wood conducted the audit and reported to the council that all was in order with the fund.
Thomson, however, noticed irregularities in the checks provided to the auditor. It would later be discovered that Day had manufactured the documentation provided to Wood.
Wood did not detect the falsified data, even though checks provided did not have transit routing information, all the checks were sequentially numbered, and all were made out to different companies, but mailed to the same post office box.
The report also indicated that Day forged resolutions including signatures from Chairman Creager and Morgan County Clerk Stacy Lafitte. It details that Day forged Creager’s signature on documents used to open bank accounts and obtain a fraudulent line of credit in the county’s name.
The report provides a summary of the interview with Day. “During the interview the subject stated the following in substance: Garth Day stated he wished to cooperate with this investigation and give a full confession regarding all financial crimes he committed during the time he was appointed as the Morgan County Counsel [Council] Administrator. He admitted to opening several fraudulent accounts with financial institutions in order to facilitate the theft of money from the Morgan County Treasury. He confirmed that he had forged Morgan County Chairman, Sid Creager’s signature on a loan document and fictitiously created financial documents in order to conceal his crimes. Day admitted he had used the alias (Alex Baker) and used a cell phone to dupe Ms . Thomson into believing the Utah Department of Transportation had received a check from the Morgan County Treasury. Day estimated he had stole about $415,000.00”
The majority of the funds misappropriated by Day will not be the responsibility of the county. The fraudulent line of credit will be the responsibility of the bank that allowed the line of credit to be opened. The county has a little more than 130,000 that they are still trying to obtain from the bank seized by the FDIC. Chairman Creager previously reported that the County’s insurance policy will cover any losses to the county and the taxpayers will not be impacted.
The case against Day was referred to the FBI for federal prosecution on January 12. Charges are expected to shortly be filed at the federal level.