SANTA CRUZ COUNTY, Ariz. (KGUN) — A county treasurer is supposed to keep taxpayer money safe. For several months the now-former Treasurer for Santa Cruz County has stood accused of taking more than $39 million in taxpayer money. Now, Arizona’s Auditor General has a report on how investigators think it happened.
The state auditor's report says in a typical year, Santa Cruz County takes in about $41 million in property tax for the county, six school districts, a community college and some taxing districts.
The report alleges former Santa Cruz County Treasurer Elizabeth Gutfahr took more than $39 million.
State auditors say over 10 years, she covered up transfers to personal accounts by lying on reports, lying to her staff, lying to county supervisors and lying to state auditors. The the biggest transfers in the last year came right before money laundering investigators at Chase Bank said they noticed $4.5 million in wire transfers from the county treasurer accounts to accounts for Gutfahr’s personal businesses.
That’s when Gutfahr resigned, and investigations by the FBI, the state, and Santa Cruz County began.
The report says Gutfahr’s attorneys said she will not be talking with them. There are no criminal charges but Santa Cruz County is suing to try to recover the money for county taxpayers. A judge has frozen most of her accounts for now to prevent hiding or selling off assets.
The auditor report says Gutfahr convinced the chief deputy treasurer to give her the codes to access all accounts, and that she managed to keep all six employees of her department from noticing anything wrong. The report also says that she gave employees gifts, like a $6,000 loan so her chief deputy treasurer could buy a new air conditioner. The chief deputy treasurer told investigators she planned to repay that money after she retired.
The report cites other gifts, like paying for the chief deputy’s personal cell phone, and allowing the chief deputy’s sister to use one of Gutfahr’s cars, worth about $3,000.
The auditor's office says Gutfahr sometimes paid bills for the department's senior secretary, and gave that secretary $1,500 for her birthday.
The report says a tax clerk told investigators Gutfahr gave her son a generous gift when he got married, allowed her daughter to get married at Gutfahr’s ranch and took that tax clerk along for a long weekend stay in San Marcos, Mexico.
And investigators say Santa Cruz County Supervisors did not supervise the treasurer’s office very well, and missed clear signs that something was up—including a monthly cash balance report that did not change by a single penny for 14 months.
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Craig Smith is a reporter for KGUN 9. With more than 40 years of reporting in cities like Tampa, Houston and Austin, Craig has covered more than 40 Space Shuttle launches and covered historic hurricanes like Katrina, Ivan, Andrew and Hugo. Share your story ideas and important issues with Craig by emailing craig.smith@kgun9.com or by connecting on Facebook and Twitter.
