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Chester County Press

The Kennett Township investigation: A web of deceit, devices and trickery begins

12/17/2019 02:05PM ● By Richard Gaw

By Richard L. Gaw

Staff Writer

The following news story provides a summary of the specific and detailed findings that are contained in the 43-page police criminal complaint filed by Robert J. Balchunis, Jr., a sworn police detective with the Chester County District Attorney's Office, that details former Kennett Township manager Lisa Moore's misuse of Kennett Township funds, that resulted in her Dec. 10 arrest when it was discovered that she had embezzled $3,249,453 from Kennett Township over an eight-year period.

While much of this news story contains information pulled nearly verbatim from this report, it is also supplemented with additional facts relevant to Moore, the township and the investigation, in order to provide a clear and comprehensive narrative.

From the time she was first hired as a clerical manager for Kennett Township in June 1997, Lisa Moore was on a fast track to a very successful career.

She quickly rose through the ranks of municipal government, and in 2010, she was appointed as the township's manager. Subsequently, she was given the responsibility of overseeing the township's daily business and its financial operations, such as employee compensation, processing vendor invoices and payments, and taking direction from the township's supervisors, Allan Falcoff, Michael Elling and Robert Hammaker.

Over that time, Moore exercised primary – at times exclusive – control over access to the QuickBooks accounting software the township used to record financial transactions.

While she was earning top marks for her work at the township, Moore was also becoming a key stakeholder in the economic development and historic preservation of southern Chester County, serving on the Kennett Area Economic Development board and on the board of Historic Kennett Square. Over the last decade, she had become a well-respected fixture throughout the Kennett area community, a tireless advocate for open space, parks and trails and business owners.

In a wealthy municipality that had assets of more than $25 million, and which had an annual general fund budget of more than $5 million –

Lisa Moore was Kennett Township's first – and many would say, best – face forward.

On April 3, 2019, Dr. Richard Leff, the township's board vice chairman, reported to the Kennett Police Department that he had been contacted by the Capital One Fraud Department concerning township money transfers – both via check and automated clearing house (ACH) payments – from a township account to a personal Capital One account. He told police that the fraud department reported that Capital One had received deposits from the Kennett Township Board of Supervisors consolidated fund business checking account with Fulton Bank – using account number X0760 – on another person's personal Capital One consumer checking account.

Capital One reported that the deposit activity on the account is unusual for a personal checking account, and wanted to confirm that these funds were being used with the supervisors' knowledge and consent. On the same day, the Kennett Police Department informed each of the supervisors – Leff, Whitney Hoffman and board chairman Scudder Stevens, as well as Moore – about the “suspicious” transactions.

After the police contacted the Capital One Fraud Department, they learned that between May 2016 and April 2019, approximately $756,751.92 had been transferred from township account X0780 at Fulton Bank to a personal Capital One account identified as X1751. Kevin Toth of the Capital One Fraud Department assured that the transfers, made in the form of banking check deposits and ACH deposits, had all been authorized by Moore, in her capacity as township manager.

On April 9, the Kennett police met with Fulton Bank account manager Michael Essmaker, who confirmed that account number X0780 was a township account, and that a large sum of money had been transferred from account number X0780 to the Capital One personal bank account number 360 X1751 since early 2016.

On April 24, the township police met with Cindy Wessner-Schaeffer, the vice president and fraud risk group manager for the Fulton Financial Corporation, who expressed concern about the large sum of money that was being transferred from township account X0780 to the Capital One 360 X1751 account. Soon after, the police visited the Fulton Bank on School House Road in Kennett Square, where they collected copies of every check that was related to transactions between the two accounts.

There were 61 of them.

Soon, the police discovered that a majority of the checks contained not only Moore's signature, but Stevens' signature, as well. On April 24, the Kennett police asked the Chester County District Attorney's Office to open up an investigation into the reported activities. Subsequently, the Chester County Detectives, led by Robert J. Balchunis, Jr., a 20-year law enforcement officer in the county, began an investigation that would take the next eight months, involve a collaboration with a forensic auditor, and hold the residents of Kennett Township and most of southern Chester County in a vice grip of rumor and impatience.

On the same day, Moore was on vacation in France.

 

The signature stamp

 

Balchunis reviewed the 61 checks and observed that each one was from the township's supervisors' consolidated fund, and paid to the order of Moore and issued to Moore. Balchunis also noticed that each check was marked with a designation that said that any check over the amount of $2,000 requires the signature of two township officials. The checks that were over $2,000, Balchunis observed, not only contained Moore's signature, but Stevens' signature.

On April 24, Balchunis and the township police met with Stevens, who agreed that while the signature was indeed his, he said that each time he signs his name, it appears slightly different, while each signature on the checks appeared to be exactly the same. He then asked if the township had a stamp with his name on it, stating that he was not aware of such a device and had not authorized one. He also stated that he did not authorize the checks and did not know why they had been issued to Moore.

After Stevens provided consent to search Moore's office, an ink stamp containing both Stevens' signature and Moore's signature were found. He later identified 18 unauthorized checks made in 2016, that totaled $85,560.68; 23 checks in 2017 that totaled $149,867.88; 15 checks that totaled $122,039.92; five checks totaling $47,413.85 – all of which added to a total of $404,882.33.

Over the next few weeks, the investigation discovered a complicated, shell game transfer of money from various accounts that belonged to the township and to Moore. On April 26, Balchunis spoke with Wessner-Schaeffer, who told Balchunis that, after further review of Kennett Township account number X0780 at Fulton Bank, she discovered that additional funds had been transferred to the Capital One account number X1751, as well as to an additional personal bank account, identified as account number X0357.

On April 29, Balchunis obtained a search warrant that authorized Wells Fargo to provide account holder information to bank account X0357, and on May 6, Balchunis received word that the account belonged to Moore.

On April 30, Balchunis received records from Capital One, which listed that account X1751 was Moore’s. It was opened on Sept. 8, 2011, and also linked to Wells Fargo account X0357 and BB&T account X7498.

On May 2, Wessner-Schaeffer told Balchunis that township payroll funds amounting to $1,479,109.03 had been transferred from the township's Fulton Bank account X0780 into Capital One account number X1751 and Wells Fargo account number X0357. A subsequent investigation revealed that both accounts also belonged to Moore.

May 1 served as a crucial and fact-finding day in the course of the eight-month investigation, one that soon after revealed a fabricated letter, led to the connection between several accounts and transactions, and included a recorded interview with Moore.

 

Fabricated letter

 

On that day, the township’s supervisors consented to the search of Moore’s office at the Township Building. In Moore’s personnel file, investigators found a letter using the letterhead belonging to Umbreit Korengel & Associates P.C. Certified Public Accounts. The letter was addressed to Moore, regarding outstanding payroll liabilities. “I am responding to your request for documentation of your outstanding liabilities,” the letter began. “As of Dec. 31, 2012, you have the following outstanding liabilities: 1. Unused sick and vacation – 3128 hours; 2. Owed Comp Time per personnel policy – 14,218 hours. Contact me with further questions.” The letter was signed by Timothy D. Umbreit, and included “TDU/mw” at the bottom of the document.

Balchunis spoke to Umbreit on May 10 and asked him if he would make any recommendations having to do with the township’s payroll liabilities, specifically related to sick, vacation and sick time reimbursement. Umbreit stated that was a township policy decision to make, and subsequently reviewed two letters that Moyer recovered from the Dell Inspiron 17 laptop computer Moore used. Umbreit said that it was very unusual that he would quantify the numbers, especially the number of hours listed on the letter, because he does not keep them. He further stated that there would be no reason he would serve as the official for the amount of hours Moore was owed.

Umbreit also noticed that the words on the letter appeared to be smaller in point size than what the company normally uses in its correspondence. He then directed his employees to search the company’s server to locate the letter, and on May 13, Umbreit told investigators that there was no record of the letters on the company’s server.

Further, Umbreit stated that the “mw” at the bottom of the letter identified Marie Wilson, who he said had retired from the company in June 2013 and could not have prepared the letter.

On that same day, Balchunis served a search warrant at Moore’s residence, where an Apple iMac all-in-one computer was seized and subsequently turned over to Zachary Moyer, a forensic analyst with the Chester County Detectives Forensic Unit. A review of system and user data recovered from the Apple iMac all-in-one computer revealed several documents that listed various and conflicting amounts of payroll liabilities and comp time records that pertained to Moore.

During a recorded interview with Balchunis and Detective James Ciliberto of the Chester County Detectives Major Case Unit, Moore admitted to improper conduct. She told detectives that she had been paying herself through the township’s General Fund account. According to Moore, she did so based on an agreement signed between her and the township supervisors, which she supplied to investigators.

Moore told detectives that she wrote herself checks personally from the township’s general fund – none of which were designed as payroll checks – in order to avoid paying taxes. The checks that she wrote to herself were stamped with the signature of a township supervisor – Stevens -- because she knew that the supervisors would not have otherwise have authorized the checks. She admitted that she was using the township’s general fund to pay for her personal credit card bills – expenditures that were left off of the township’s general accounting sheets that she provided to township officials.

Moore told detectives that she had been doing this practice for the past eight years.

She was placed on paid administrative leave from the township. On May 17, she was dismissed from her job as the township’s manager. In a press release issued on May 20, it stated that Moore's dismissal came “after new information was discovered and brought before the supervisors. The dismissal action was coordinated with the township’s legal and human resources representatives.”

Restoring normalcy in the township

As May turned into June, Balchunis, Moyer, Ciliberto and representatives from the DA’s Office and Chester County Detectives continued to step up their investigation into the facts behind Moore’s manipulation of township funds. At the same time, the Kennett Township Building was converted into an administrative triage center in an effort to restore trust in a local government at a time when public trust was eroding in a mash-up of rumor, anger and insinuation.

For Stevens, an attorney with Lyons, Dougherty, LLC; Hoffman, an online media marketing professional; and Leff, a medical doctor, it meant taking over a large chunk of administrative tasks normally reserved for the township manager. They held executive sessions, wrote township checks, maintained payroll, and conducted business with vendors.

On May 28, they hired Alison Rudolf, who had served as the township manager for Lower Moreland Township for 26 years, as interim township manager. Very quickly, the board voted in favor of measures intended to clean up its accounting systems, and on June 19, based on Rudolf’s recommendation, the board approved a resolution to assign all township accounts at Fulton Bank with a new account number, and to authorize that all township checks will require at least one supervisor’s signature on all township checks.

The township also hired David Woglom, Associate Director for Public Service at the Meyner Center at Lafayette College for the Study of State and Local Government, to help conduct a search for a permanent manager. In August, after reviewing the applications of 33 hopefuls, the board hired Eden Ratliff, the borough manager and chief administrative official of the Borough of Greencastle in Franklin County, Pa.

“We wanted a township manager possessing the skills and educational background to effectively and efficiently manage Kennett Township, as well as an individual with the foresight to lead the township forward for many years,” Stevens said of Ratliff at an Aug. 21 board meeting. “I believe you will be pleased by his credentials, skills, and all that he will bring to Kennett Township in the years to come.”

Before Ratliff began his new position on Sept. 23, however, it was a troubling summer for Stevens, Leff and Hoffman. At each board meeting, they attempted to sell the township’s message of transparency in the form of carefully worded statements about the investigation that were written by newly hired media consultant Carl Francis. News from the District Attorney’s Office began briskly but sputtered by early fall; at the same time, township residents demanded answers and not rhetoric, and several board meetings escalated into a demand for specifics that were not coming.

While the investigation into township accounting that had begun in late April was being conducted behind closed doors, the work being done by the District Attorney’s Office, the Chester County Detectives, Marcum, LLP and other agencies was beginning to unravel a spider’s web of money manipulation that robbed the township of more than $3 million and would lead to the arrest of a suspect who at one time – right in front of elected and appointed officials, key stakeholders and everyday citizens -- had punched her ticket to becoming one of the most respected and trusted public officials in Chester County. 

This is the first in a series of stories the Chester County Press is publishing in its investigation of the findings included in the police criminal complaint report filed by the Chester County District Attorney’s Office that provides details about the embezzlement of more than $3 million of Kennett Township funds by former township manager Lisa Moore. The Press will provide a complete report of the public meeting hosted by the township at the Red Clay Room on Dec. 17 that will discuss the investigation in its Dec. 24 edition.

The report has been made public by Kennett Township, and is available on its website, www.kennett.pa.us.

To contact Staff Writer Richard L. Gaw, email rgaw@chestercounty.com.

 

 






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