The town of Oxford has officially received a check for $100,000 from The Hartford Fire Insurance Co., the total amount it bonded for the fidelity and honesty of former Tax Collector Karen Guillet, whom officials say may not have been that honest.
Guillet is accused of stealing more than $670,000 from the town over a six-year period. Investigations into her actions are ongoing; she has resigned from the tax collector post she held for 24 consecutive years.
Background from last week
First Selectman Mary Ann Drayton-Rogers announced the news at a press conference Thursday. Drayton-Rogers said a criminal investigation into Guillet's actions is ongoing, as is a civil suit; the $100,000 insurance payment is part of the civil suit process. She said the town hopes to recoup all of the money stolen, and believes the news of the $100,000 payment - which will go into the town's general fund - shows that could be possible.
"This has been and continues to be an intense and time-consuming process with claims yet to be proven against (Guillet)," Drayton-Rogers said of her one-time friend and former co-worker. "While I have stated this matter is a difficult and trying one, I will continue with every effort to diligently pursue futher claims in the civil courts (the civil case is still in the early stages of discovery). ...This is one successful step in a long process which continues and will be followed through to the end of the investigation in the name of our residents and taxpayers."
Town Business Manager Jim Hliva said he and town officials are in constant contact with police detectives who are investigating the case. Drayton-Rogers said the criminal aspect of the case is being handled through the Connecticut State Police Major Crimes Squad, and that town officials have gone out of their way to help in any way they could with that investigation.
"It's their investigation so it's on their schedule," she said of police, "But we will continue to work with them and push them to move it forward in the name of justice for our residents."
State police spokesman Lt. J. Paul Vance said Thursday police expect to wrap up their investigation within the next four to eight weeks.
"There is no length of time for how long a criminal investigation should take," he said. "This one in particular is taking some time because there is a tremendous amount of physical auditing that goes into the case, and that is very time consuming."
The town of Oxford, meanwhile, is taking steps to make sure something similar doesn't happen again. For example, the town now has two full-time people in the tax collector's office, whereas throughout much of Guillet's tenure it had just one. The town is also accepting credit card payments in the tax collector's office to avoid so many cash payments, and Town Clerk Margaret West has applied for funding for surveillance cameras for the town clerk's vault, the town clerk's front desk and the tax collector's office.
But all of the physical fixes cannot take away the emotional suffering the case has caused.
Drayton-Rogers discussed her and the town's collective pain, anger and embarrassment on Thursday.
"I knew her as a friend," she said of Guillet. "There is nothing I can say that can fully express the disappointment for the situation that the town has had to face."
Drayton-Rogers said she has not heard from Guillet and does not want to speculate on rumors about her whereabouts. Guillet has turned down numerous requests for comment from various news organizations.
Background (The following was published on Oxford Patch in the spring)
On Jan. 13, 2010, First Selectman Mary Ann Drayton-Rogers confronted her one time friend and Oxford's longtime Tax Collector Karen Guillet after auditors confirmed fraud had been committed in the tax office.
During a scheduled meeting in the selectmen's office, Drayton-Rogers said she asked Guillet three times about $3,093 that had not been properly deposited at Naugatuck Valley Savings & Loan.
Guillet responded to the first two inquiries by stating, "It's not in the bank...It's not on my desk..." Drayton-Rogers testified at Milford Superior Court Friday.
"And when I asked her a third time, she said, 'I guess I took it,'" Drayton-Rogers said.
And so began the downfall of a once respected tax collector who had cruised to re-election time and again over the past 24 years.
Drayton-Rogers testified Friday during a probable cause hearing as part of a against Guillet in an attempt to recoup the money town officials claim Guillet stole. Drayton-Rogers said, after Guillet admitted to taking the money, she told the former tax collector she would not return to her office, advised her to obtain legal counsel and took Guillet's work keys before having her escorted out of Town Hall.
Before she left, Guillet said, "I'm glad it's over with," Drayton-Rogers testified.
Guillet was immediately placed on leave and was paid using her accrued sick time. She resigned five months later.
An ad hoc committee appointed by Drayton-Rogers contends that the 'it' to which Guillet referred was a scandal that Finance Director Jim Hliva compared to a Ponzi scheme, through which Guillet frequently stole cash payments and then shifted checks from other deposits to make up for the cash shortages. (Note: Guillet also owned taxes to the town for 2009 but paid them off in April of this year.)
Since news broke of the alleged scandal, dozens of residents and business owners said they received delinquent tax notices even though they had proof of payment, Hliva testified. All told, those claims amount to $671,768 dating back to 2003, a number that Hliva called a "moving target" as people continue to make claims of delinquent notices they should not have received.
All of the people who can prove they paid their fair share - either through a receipt from the tax office or a cancelled check - have had their accounts credited, Hliva said.
The three-member ad hoc committee investigated only the largest dollar amounts, which were in the thousands of dollars, Hliva said.
As part of their detailed investigation, committee members took cancelled checks back to NVS&L and asked to see documentation of all money deposited on those days, Hliva said.
The committee then compared the bank's records to those of the tax collector and noticed they did not match. For example, on Aug. 10, 2009, $9,255 in cash was taken into the tax collector's office, according to town records, and just $858 was deposited at the bank, Hliva said. Checks were then taken from different accounts to make up for the cash shortage, he said.
"Kind of like a Ponzi scheme?" Judge Arthur A. Miller asked Friday.
"That is correct," Hliva replied.
Guillet's defense attorney, Dominick J. Thomas, said he believed all along the court would find probable cause.
"Based on the testimony (of Drayton-Rogers), there is no doubt in my mind the court is going to find probable cause to an amount," Thomas said. "The sole question here is the amount."
He said documentation provided in court by Town Counsel Fran Teodosio simply states that for a period of time something was wrong with the computer in the tax office.
Thomas said the defense will now look into "the backup the town has to see whether the batches and the deposits didn't jibe."
"That's all it is, nothing that they have is any proof that she took it," he said. "Now it goes to another level, so at this point, we will be addressing those issues."
Guillet has turned down numerous media requests for comment.
"My client's position is she's not going to discuss the issue," Thomas said. "You heard what she told the first selectman and that's all I'm going to say about that."
Whatever comes out of the civil case, Drayton-Rogers said the public's trust has been compromised, and town officials continue to work hard to gain it back.
"I've received many calls and comments from people who are quite upset," she said. "They are upset that somebody would use their hard-earned tax dollars for personal gain."
Judge agrees the town has probable cause
Milford Superior Court Judge Arthur A. Hiller said there was probable cause to hear the town's civil lawsuit against former Tax Collector Karen Guillet. Hiller agreed Friday to attach treble damages to the town’s claim, meaning Oxford can get triple the amount of the actual damages that officials said they were able to prove was missing after they reviewed a sampling of tax payments between 2007-09 and cross referenced them with bank deposit slips. That amount was $233,322, which, when multiplied by three equals $699,396.
The town has also put a $150,000 lien on her house and property at 2 Douglas Drive in Oxford - Guillet's half of the home she shares with her husband - and officials do not want to pay her pension, which Guillet’s attorney, Dominick J. Thomas, vehemently opposed.
Hiller has not ruled on whether the town can revoke the pension and has asked Thomas and Town Counsel Fran Teodosio to file briefs explaining their positions within two weeks.
Guillet, who was not in court, has already taken about $13,000 out of that pension account, Teodosio said. Thomas said his client is relying on that money to pay her attorney’s fees.
Guillet has not been charged criminally. The criminal investigation is being led by the State Police Western District Major Crimes Squad. State police say there is a lot that goes into these investigations and they could take up to five years.
Guillet served as Oxford's elected tax collector for 24 years before she resigned in June.