BREAKING: Sheriff Arpaio's (MCSO's) Posse Policies Will Get Fresh Set Of Eyes; Arizona Auditor General's Office Responds

(Update, 3/13/15: The Auditor General's report on Maricopa County for 2014 did not mention the issues discussed below. The Auditor General's office confirmed to Arizona's Politics that it considered the issues but did not include them because "the Sheriff's Posses are private not-for-profit-organizations....Our Office has no legal authority to audit (their) activities...." The audit also found no weaknesses in the County's internal controls regarding insurance/titling/fuel usage for posse vehicles.)

The grounding of Posse-owned vehicles by a few of the many volunteer Posses under the direction of Maricopa County Sheriff Joe Arpaio may be over - but the issues raised by former Cold Case Posse member Brian Reilly and that have been exposed by several reporters remain. A fresh set of eyes on the Maricopa County Sheriff's Office ("MCSO") Posse Program Policies and Procedures - and, the interactions between the County, the MCSO and the Posses - would be very helpful. Those eyes may be beginning to focus.

(For more background on the insurance-related grounding, and how the former Cold Case Posse member who spoke out about his experiences may have started the ball rolling, please click here.)

Each year, the Arizona Auditor General's Office audits every county's financial reports and internal controls. When possible issues arise during the year, the AG's Office adds them to the list of things they check out in the next audit. Sometimes, the new issues result in changes being recommended to the county and sometimes they do not.

Responding to the issues raised by recent news coverage - and, responding to questions from the news media - the AG's office "will consider the information" about the County/MCSO/Posse relationship. Deputy Auditor General Melanie Chesney emphasizes that that does NOT mean that there is "potential wrongdoing", and notes that the next audit for the 2013-2014 fiscal year (ending June 30) will not be completed until early 2015. Also, before it is released, the County has the opportunity to respond - concur or dispute - the Auditor General's recommendations.

Some of the issues that the AG's auditor might soon be starting to take a look at include:

1) Insurance on vehicles being used for County-related business, but owned by non-profits/volunteers who were (are?) under the impression that the County's self-insurance pool will cover them.
2) Titling of the vehicles being used by Posses. While there is evidence that the County (properly) sold vehicles to various Posses, Brian Reilly was told that the County owned the vehicles.
3) Government-issued plates. Posse-owned vehicles - marked and unmarked - have had license plates identifying them as governmental vehicles "G Plates".  State statutes indicate that this might be unlawful for most or all of the Posse vehicles.  One possible way that this happened is that the County and/or the MCSO transferred the titles but let the Posse entities (improperly) keep the County's G Plates. A 2nd possibility is that the MCSO (improperly) gave the Posses G Plates bulk-issued to the County by ADOT.
4) County Gas Keys/Cards. While Posses/members may have been properly allowed to use County-supplied gas for official Posse uses, there do not appear to be any controls on Posse vs. personal use. (Also, Sheriff Arpaio promised the County and voters that he would not use County funds for the Cold Case Posse's birth certificate investigation; yet, those Posse members did have County gas cards/keys, and Reilly says that the birth certificate investigation was the only thing CCP was working on.)
5) Accounting for Donations. Some Posses - such as the Cold Case Posse - solicited and received donations from across the nation, as a direct result of Sheriff Arpaio's investigation of the Obama birth certificate. In fact, on at least one occasion, the Sheriff made the call for people to support the Cold Case Posse and their investigation. However, the Cold Case Posse tells the IRS that they do not have to file 990 returns because they are MCSO-affiliated. And, the MCSO has repeatedly told Arizona's Politics and others that the Posses do not report financials to them and that the MCSO exercises no oversight on these MCSO-affiliated organizations. 

      The Cold Case Posse's lack of transparency likely hides donations and expenditures that violate the MCSO's own policies and procedures and federal tax law, and call into question the MCSO's (and, the County's) complicity in at least one of these fundraising-machine Posses.

       CCP's leader, Mike Zullo, had told former Posse member Brian Reilly in mid-2012 that the CCP had received more than $80,000 in donations that year. The threshold for filing an IRS 990 is $25,000. Thus, it was the claim of County-affiliation that permitted CCP to not file with the IRS.  If the CCP was able to use the same databases with which the Sheriff raised $3.5 Million the following year, the potential amount of donations flowing to the quasi-governmental organization - with no contribution caps - is very large.

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