City Worker Allegedly Stole $253,000 in Public Funds

A 21-year Long Beach Animal Control Services worker was arrested this morning for allegedly embezzling $251,000 in public funds due to what the City Auditor called poor oversight and lack of technology.

The Long Beach Police Department reported:

"On Thursday, May 10, 2012, detectives from the Long Beach Police Department’s Forgery/Fraud Detail arrested Jongluck “Lucky” Mutrais, a former Long Beach Animal Care Services Bureau clerk, for misappropriation of $251,000 in public funds.

 Suspect Mutrais, a 59-year-old resident of Orange, was arrested at her home this morning without incident and charged with multiple felony counts, including misappropriation of public funds, altering or falsifying an account, embezzlement by a public officer, and filing false tax returns. She is currently being held at the Long Beach City Jail on $500,000 bail.  If convicted of all the charges, Mutrais faces up to nine years in state prison."

The City Auditor also issued a press release, which read, in part:

"At the time the audit was conducted, ACS was a bureau under the Department of Health and Human Services.  In the summer of 2011, the City made organizational changes, and the ACS Bureau was placed under the Department of Parks, Recreation and Marine.

During FY 2009 and 2010, bureau management was implementing significant improvements to ACS operations.  This included the installation of new technology overseeing the animal licensing and cashiering functions.  This new system allowed management, in August 2010, to identify a discrepancy in deposited revenues.  Upon discovery of this discrepancy, management contacted the Office of the City Auditor for an audit."

The key findings of the audit focus on the inadequate reconciliation process, a lack of proper segregation of duties, and the need for supervisory review.

City Auditor Doud, who is an elected official, elaborated in her statement:

“This misappropriation of public funds was able to occur, because one employee had the ability to perform the reconciliation and deposit the money without any supervisory review, creating a high risk environment for fraud.

“As the City continues with cuts to the budget and the possibility of eliminating staff, this instance heightens the importance of ensuring proper controls are in place to verify all monies are deposited into the City’s treasury. This includes having clear procedures and training for managers overseeing cash so they can adequately design and implement proper controls that will safeguard our City revenue."

Both releases landed in our mailbox after 4 p.m. City Auditor Doud reported that an audit was conducted and completed October, 2011, but was not released due to the criminal investigation by Long Beach Police Department. Click here to read the audit.

The Los Angeles County District Attorney's Office at 2:30 p.m. issued a news release about the case, stating that Mutrais is expected to appear in court on the charges Friday or Monday. It said she was arrested after the City installed a new computer system able to better track accounting, but said Mutrais is suspected of allegedly stealing "hundreds of thousands" more than the $250,000 over a 10-year span.

The DA release said: "Deputy District Attorney Dana Aratani of the Public Integrity Division said that estimates reveal that, in total – over the course of more than 10 years of employment with the bureau – Mutrais had misappropriated hundreds of thousands of dollars in addition to the $251,000.

"Mutrais resigned in August 2010. The Animal Care Services Bureau is responsible for kennel operations, dog licensing, adoption and general animal control.

Bail for the defendant is recommended at $500,000. If convicted as charged, Mutrais faces up to nine years in state prison."

She is charged with nine counts – one count of misappropriation of public funds, one count of altering or falsifying an account, one count of embezzlement by a public officer, and six counts of filing false income tax returns. The criminal complaint includes excessive-taking allegations exceeding $200,000 in losses.

"Mutrais is expected to appear for arraignment tomorrow or on Monday in Department 30 of the Foltz Criminal Justice Center. She is charged in case No. BA397219. The case was filed on May 9, 2012," the press release stated. The case is being handled by the D.A.'s unit that handles public employees, police and attorneys.

As to the time span between discovery and audit completion and arrest, Long Beach Police spokeswoman Lisa Massacani said:

"Regarding your question, investigations of this sort are typically lengthy. A number of agencies were involved, including the IRS and Franchise Tax Board, as well as several City Departments, and lots of paperwork was involved, as well as the identifation of assets and the examination of all the paperwork regarding those as well. Just the act of acquiring the paperwork is a lengthy process."