Audit reveals Palmview made ‘extravagant purchases’ with asset forfeiture money

Palmview spent federal asset forfeiture funds on “extravagant purchases,” including three high-end trucks, parties and sports tickets, according to an audit approved by the City Council earlier this month.

Prepared by city Finance Director Rachel Chapa, the nearly 470-page report documents major accounting problems and potentially improper spending during the past seven years.

City of Palmview Logo“It’s embarrassing,” said City Councilwoman Linda Sarabia, who urged Palmview to investigate spending under the prior administration.

Federal law allows the Justice Department to confiscate money and property linked to criminal activity. The Justice Department frequently shares the money with local police departments that provide assistance on federal cases.

Palmview received more than $2.2 million through the program during the past seven years, according to financial records provided by the city.

The Justice Department requires local partners to spend the money for law enforcement purposes.

Palmview, though, routinely broke the rules, according to the audit report.

“It’s not an opinion,” Sarabia said. “It’s black and white. They’re facts.”

Palmview didn’t maintain separate accounts for federal asset forfeiture funds and state asset forfeiture funds, according to the audit report. Palmview deposited the money into a single bank account, along with grant money and towing fees.

The City Council created a separate bank account for state asset forfeiture funds, which come with different reporting and regulatory requirements, last week.
Palmview also balanced the city budget with asset forfeiture money in 2014 and 2015, according to the audit report.

The Justice Department explicitly prohibits spending asset forfeiture money on general government expenses.
Travel and food expenses raised questions too, according to the audit report, which identified a slew of potentially improper expenditures.

“Extravagant purchases include two 2011 Ford Raptors and one 2012 Ford Raptor valued at over $50,000.00 each,” according to the audit report.

Palmview also paid for a Christmas party, gift cards and hockey tickets with the money.

Financial records attached to the audit show Palmview paid $1,100 on Dec. 23, 2015, for “Christmas Party.”

What, exactly, Palmview purchased remains unclear. The audit report doesn’t include receipts or invoices for the expenses. Chapa said Palmview is still searching for additional documentation.

Neither former City Manager Johnn Alaniz nor former City Manager Ramon Segovia, who filed a lawsuit against the city for breach of contract, would comment on the audit report.

Former police Chief Chris Barrera, who shared responsibility for the asset forfeiture account, referred a request for comment to attorney Javier Peña.

“It seems to me like they’re trying to pass the buck for their own mismanagement,” Peña said, adding that Barrera didn’t sign any checks or control the account.

Barrera could recommend expenses, but the city manager and the City Council ultimately approved how Palmview spent the money.

The City Council fired Barrera last month after he sent vulgar text messages to Fire Chief Jerry Alaniz.

“Right now Barrera is a target for them to push the blame onto,” Peña said.

Sarabia acknowledged the City Council ultimately approved spending, but said members relied on advice from management.

“And I’m not blaming previous councils,” Sarabia said. “I can see where if they don’t have a financial background or asset forfeiture experience they’re going to rely on what this professional, trained person is telling them.”

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