OFFICE OF INSPECTOR GENERAL

PALM BEACH COUNTY

John A. Carey Inspector General
Inspector General Accredited

Enhancing Public Trust in Government

Investigative Report
2017-0004
Public Safety Department
Theft
March 28, 2017

Insight Oversight Foresight

 OFFICE OF INSPECTOR GENERAL
PALM BEACH COUNTY

INVESTIGATIVE REPORT
2017-0004
John A. Carey Inspector General
Inspector General DATE ISSUED: MARCH 28, 2017 Accredited

Enhancing Public Trust in Government

PUBLIC SAFETY DEPARTMENT THEFT
SUMMARY

WHAT WE DID WHAT WE FOUND

On November 17, 2016, the Office of As to Allegation (1), the information

Inspector General (OIG) received a obtained and reviewed by the OIG
complaint from the Palm Beach County supports the allegation. The OIG found
(County) Public Safety Department (PSD) that Ms. Pedemey diverted funds from the
involving PSD Administrative Assistant AEID fees. To accomplish this, during the
Anita Pedemey. period of October 1, 2013 to November 14,
2016, she altered or recreated and
The complaint alleged that (1) Ms. submitted Daily Payment Activity1 reports
Pedemey diverted funds from the PSDs that included inaccurate and understated
Adult Entertainment Work Identification information.
Card (AEID) fees to her personal use. The
PSD Director estimated $7,000.00 in Ms. Pedemeys diversion of funds was not
funds had been diverted over the six discovered until her voluntary admission to
months prior to the allegation. the PSD Director and the PSD Director
Finance and Administrative Services.
As the allegation contained potential
criminal activity, pursuant to Section 2- The OIGs investigation disclosed that the
423(4) of the Inspector General reports submitted by Ms. Pedemey during
Ordinance, on November 21, 2016, the the period of October 1, 2013 to November
information was provided to the Palm 14, 2016 were inaccurate and understated
Beach County State Attorneys Office, by at least $27,575.00.
Public Corruption Unit (PCU). The PCU
agreed to the OIG conducting the initial Based on the information obtained during
investigation into this matter. Therefore, this investigation, the OIG developed an
the OIG initiated an investigation. additional allegation.

Allegation (2) that Ms. Pedemey diverted

funds from the PSD Victim Services Fund

1 A report from the AEID database which shows the fees paid by individual, amount, and payment type for a specific
timeframe.

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(VSF) donations/payments2 to her Allegations (1) and (2) will be referred to

personal use. the PCU for action as they deem
appropriate.
As to Allegation (2), the information
obtained and reviewed by the OIG Based on our supported findings in
supports the allegation. The OIG found Allegations (1) and (2) we consider the
that Ms. Pedemey diverted funds from the $28,875.00 that Ms. Pedemey diverted to
VSF donations/payments. To accomplish her personal use to be identified costs3
this, during the period of October 1, 2013 and the additional $3,305.00 that was
to November 14, 2016, she submitted never deposited to be questioned costs.4
incomplete and therefore, understated
records to Finance and Administrative WHAT WE RECOMMEND
Services.
The OIG recommends that the Countys
The OIGs investigation disclosed that the PSD:
records submitted to Finance and
Administrative Services by Ms. Pedemey 1. Take appropriate personnel actions.
during the period of October 1, 2013 to
November 14, 2016 related to VSF Ms. Pedemey resigned during the OIG
donations/payments were incomplete and investigation. Therefore, we consider
understated by at least $4,605.00. this recommendation closed. The
$1,300.00 of these donations/payments County may be able to recoup
we have identified as cash. The remaining misappropriated funds.
$3,305.00 could not be identified as cash
donations/payments due to a lack of 2. Consider only accepting checks,
supporting documentation or testimony; money orders, or debit/credit cards as
nevertheless, based on statements from payment methods for the AEID fees
Finance and Administrative Services and the donations/payments made to
employees the funds were not deposited the VSF. Approximately 70% of the
into the VSF account. fees for the AEIDs are collected in
cash, a higher fraud risk.
During the course of our investigation, the
PSD Justice Services Division created a 3. In the event that PSD continues to
new Standard Operating Procedure (SOP) accept cash as a payment method for
for receiving and processing financial the AEID fees and VSF
donations made to the VSF. donations/payments, PSD should
consider establishing additional
internal controls and methods of
supervisory review to safeguard the

2 The PSD Justice Services Division refers to some of the VSF proceeds as donations. Most of the donations are
ordered by the Palm Beach County Court of the Fifteenth Judicial Circuit to defendants of cases that they handle.
3 Identified costs are those dollars that have the potential of being returned to offset the taxpayers burden.
4 Questioned costs can include costs incurred pursuant to a potential violation of a provision of law, regulation, contract,

grant, cooperative agreement, or other agreement or document governing the expenditure of funds, and/or a finding
that such costs are not supported by adequate documentation, and/or a finding that the expenditure of funds for the
intended purpose is unnecessary or unreasonable in amount. As such, not all questioned costs are indicative of
potential fraud or waste.

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cash and establish responsibility in with the Daily Payment Activity report
case of loss or shortage. from the AEID database as a method
of double checking.
4. Deactivate the ability to export the
Daily Payment Activity report from the The County (PSD) concurred with our
AEID database. recommendations. We have included
PSDs response, in its entirety, at the end
5. Consider establishing a Standard of this report.
Operation Guide wherein the cardstock
utilized to print the AEIDs is reconciled

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BACKGROUND

The Palm Beach County (County) Public Safety Department (PSD) is made up of six
divisions: 9-1-1 Program, Animal Care and Control, Consumer Affairs, Emergency
Management, Justice Services, and Victim Services. Many of these divisions deal directly
with the public and collect fees from the public for some of the services PSD provides.

Section 17-153(a) of the County Code of Ordinances states that any person desiring to
perform in an adult entertainment establishment must obtain a work identification card
from the public safety department The applicant is required to pay a $75 fee when
obtaining a new Adult Entertainment Work Identification Card (AEID). The fee to obtain
a duplicate copy of an existing AEID is $25.

On November 17, 2016, Stephanie Sejnoha, PSD Director filed

a complaint with the Office of Inspector General (OIG). In her
complaint, Ms. Sejnoha stated that PSD Administrative
Assistant Anita Pedemey just had a meeting with Ms. Sejnoha
and PSD Director Finance and Administrative Services
Marianela Diaz, and through Ms. Pedemeys own voluntary
confession stated that throughout the year she had been
altering documents in order to divert funds from PSD and
apologized for her actions. Ms. Sejnoha also stated that Ms.
Pedemey along with another employee had the authority to
handle the AEID fees and Ms. Pedemey was responsible for
counting the fees and generating the reports from the
database. Ms. Sejnoha estimated that Ms. Pedemey
misappropriated about $7,000.00 from the PSD over the last
six months, but stated that the amount could be higher. Finally,
Ms. Sejnoha stated that she placed Ms. Pedemey on
Administrative Leave pending a Pre-Termination hearing.

As this allegation contained potential criminal activity, pursuant to Section 2-423(4) of the
Inspector General Ordinance, on November 21, 2016, the information was provided to
the Palm Beach County State Attorneys Office, Public Corruption Unit (PCU). The PCU
agreed to the OIG conducting the initial investigation into this matter. Therefore, the OIG
initiated an investigation.

ALLEGATIONS AND FINDINGS

During the course of our investigation, we conducted multiple interviews. We reviewed

numerous pages of records from PSD, including: Daily Packages to include: cash receipt
forms, Daily Payment Activity5 reports, cash reconciliation sheets if applicable, hardcopy
AEID applications, deposit slips and bank statement pages that display deposit
information. We reviewed an Excel spreadsheet maintained by the PSDs Victim Services

5 A report from the AEID database which shows the fees paid by individual, amount, and payment type for a specific
timeframe.

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Division (VSD) and records related to the donations/payments made to the Victim
Services Fund (VSF) to include: cash receipt forms, Victim Fund Donation Letters of
Receipt, images of payments if the donations were made by check or money order, court
documents if applicable, deposit slips and bank statement pages that display deposit
information. We reviewed electronic records for the Comprehensive Emergency
Management Plan (CEMP) fees to include: cash receipt forms, receipts and several
invoices, check payments, deposit slips and bank statement pages that displayed deposit
information. Finally, we reviewed PSDs policies and procedures, Standard Operation
Guide (SOG), County policies and procedures, and surveillance videos of the PSD
Emergency Operations Center (EOC) building.

We also reviewed records recovered with the assistance of County Information Systems
Services (ISS) including: Ms. Pedemeys incoming and outgoing emails with selected
attachments; web history and files from Ms. Pedemeys work desktop; web history from
Ms. Pedemeys work tablet; and, records related to the donations/payments made to the
VSF.

Allegation (1):
Public Safety Department Administrative Assistant Anita Pedemey altered or
recreated the Daily Payment Activity reports for the Adult Entertainment Work
Identification card activity in order to divert funds for her personal use. If
supported, the allegation would constitute a violation of Section 7.02 D, (1), (2),
(14), (17), (24), (32), (33), and (36) of the Palm Beach County Merit Rules and
Regulations, a violation of Department of Public Safety Administration Division
Receipt of Cash or Credit Card for Adult Identification policy and procedure (PPM-
PSO-020), Department of Public Safety Receipt of Cash policy and procedure (PPM-
PSF-005), and a potential violation of Florida Statute 812.014(1) and (2)(b)1.

Finding:
The information obtained supports the allegation based on the OIG review of records
and witness interviews. Ms. Pedemey was not interviewed due to the referral to the State
Attorneys Office.

We found that Ms. Pedemey diverted funds from the AEID fees. To accomplish this,
during the period of October 1, 2013 to November 14, 2016, she altered or recreated and
submitted Daily Payment Activity reports that included inaccurate and understated
information.

Chronology leading to Ms. Pedemeys Confession

OIG interview of Lashawna Howard Mitchell, former PSD Senior Clerk Typist
Ms. Howard Mitchell stated that she was employed from 2008 until April 2015 and that
from 2011 until she left the position she reported directly to Ms. Pedemey. Ms. Howard
Mitchell stated that one of her job duties was processing AEIDs and performing the related
cash reconciliations. She said that she was not provided a daily change fund and that if
change was needed she had to get change from Ms. Pedemey, who kept petty cash. Ms.

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Howard Mitchell stated that at the end of the day she ran a report from the AEID database
to verify that the money matched the report, locked the money, and placed it in her drawer.
The next business day she recounted the money from the prior day, printed the report
from the AEID database and performed reconciliation in the presence of Teresa Toto,
PSD Fiscal Specialist II, and gave her (Ms. Toto) the copies of the AEID applications.
Ms. Howard Mitchell believes that someone in Finance prepared the deposit slip. Ms.
Howard Mitchell mentioned that she was not allowed to review the deposit slip.

Ms. Howard Mitchell stated that when she was on lunch breaks and the PSD employee
covering for her processed an AEID, that employee would put his/her name somewhere
on the application to document that he/she processed the AEID and he/she would write
who the person gave the resulting cash to at the end of the shift. In addition, Ms. Howard
Mitchell stated that to the best of her knowledge, if she was on vacation, at the end of the
business day Ms. Pedemey kept the money in a safe in her office.

Ms. Howard Mitchell recalled a shortage of cash incident that happened one time while
she was out on vacation either the end of 2014 or the beginning of 2015. She stated that
she came back from vacation and after reconciling she noticed that there was $75 missing
from the cash box for one of the days that she was out. She informed Ms. Pedemey
about the issue. Subsequently, they found that PSD Senior Secretary Nancy Hayes had
processed the AEID. Ms. Hayes stated that she had given the money to Ms. Pedemey.
Ms. Pedemey told Ms. Howard Mitchell that she found the $75 in a safe and Ms. Howard
Mitchell told Ms. Pedemey to give the cash to Ms. Toto. Pedemey informed Ms. Howard
Mitchell that she would take care of it. Ms. Howard Mitchell stated that afterwards she
asked Ms. Toto if Ms. Pedemey had given her the $75 that had been found and Ms. Toto
stated that Ms. Pedemey had not. Ms. Howard Mitchell stated she did not follow up any
further.

Ms. Howard Mitchell mentioned various changes that took place in the processes and
procedures over time based on Ms. Pedemeys instructions to her. For instance, Ms.
Pedemey instructed her to stop scanning the AEID applications and storing them on the
network drive. Subsequently, she began giving the copies of the applications to Ms.
Pedemey and she no longer scanned and placed them on the network drive.

OIG interview of Nancy Hayes, PSD Senior Secretary

Ms. Hayes stated that she has been employed by the PSD since June 21, 2005. She
stated that one of her job duties is substituting for the Senior Clerk Typist during breaks
or absences. Ms. Hayes clarified that she along with two other Senior Secretaries and
Ms. Pedemey took turns in order to substitute for the Senior Clerk Typist. Each one of
them had one day to substitute at 10:00 a.m. for 15 minutes, 1:00 2:00 p.m. during lunch
break and around 4:00 p.m. for 15 minutes. Additionally, she stated that on Fridays they
would rotate.

Ms. Hayes told us that while substituting for the Senior Clerk Typist, the Senior
Secretaries never had access to the cash box. She stated that the Senior Clerk Typist
always has the key or Ms. Pedemey had a key. Ms. Hayes explained that to the best of

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her knowledge, both the cash box and the drawer were locked at all times. She explained
that if a customer came in and they needed change, Ms. Pedemey or someone in a higher
position had to be called in order to get the change. Ms. Hayes said that once they had
the cash they paper-clipped it to the application. Then, when the substituting shift was
over, they got the application(s) signed by the person receiving the cash, scanned the
application(s), and emailed it to document that the money exchanged hands. She added
that in the past, if one of the Senior Secretaries ever substituted for a full business day
then at the end of the day, the cash was given to Ms. Pedemey or Ms. Sejnoha and it was
documented.

OIG interview of Megan Morrissey, former PSD Senior Clerk Typist

Ms. Morrissey stated that she was employed by PSD as a Senior Clerk Typist from June
1, 2015 until August 2016 and that while she was in this position she reported directly to
Ms. Pedemey. Ms. Morrissey said that one of her job duties was processing AEIDs. She
said that she was provided with a $100 daily change fund and at the end of the day, she
and Ms. Pedemey reconciled by counting the cash, adding the value of the applications
that were processed on that day, and making sure that all the funds were accounted for.
If the amount of cash was more than $75.00, Ms. Morrissey gave Ms. Pedemey the cash
and the original applications and she believes Ms. Pedemey placed everything in a locked
drawer in her (Ms. Pedemeys) office desk. If the amount of cash at the end of the
business day was only $75.00, then the cash would be placed in Ms. Morrisseys locked
drawer. She believes Ms. Pedemey prepared the deposit slip and then gave it to Ms.
Toto. Ms. Morrissey informed us that when she was on lunch breaks, a designated Senior
Secretary covered for her. If the Senior Secretary processed an AEID while Ms.
Morrissey was on break, they would either: (1) hold on to the cash (if the customer gave
the exact cash equivalent to the fee) or (2) call Ms. Pedemey if they needed to give
change to the customer and Ms. Pedemey would open the cash box with the key that was
left in a drawer and provide the change to the Senior Secretary.

On June 12, 2015, Ms. Pedemey sent an email to employees of the County Planning
Zoning and Building department requesting a list of adult entertainment establishments.
A portion of the email reads: As you know, we issue adult entertainment licenses here
at the EOC. In the past year, it has been very slow (), so we wanted to send a reminder
letter to all the AE establishments reminding them of the ordinance requirements

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On January 29, 2016, emails from Ms. Morrisey revealed that on that day at least two
letters were emailed to adult entertainment establishments as reminders that according
to ordinance and resolution, adult entertainment establishments may only hire or contract
with people who have a County AEID and as a result adult entertainers in the County
must obtain a picture identification card from the PSD.

OIG interview of Teresa Toto, PSD Fiscal Specialist II

Ms. Toto, stated that she processes revenue from the AEID operation. If there was
revenue from the AEID operation, she would receive a Daily Package from Ms. Pedemey
on Tuesdays and Thursdays with the payments (cash or credit card receipts) sealed in a
deposit bag. The Daily Package would include: the Daily Payment Activity report, a pink
copy of the deposit slip and the associated AEID applications. Ms. Toto made sure that
the funds from AEID operation including the cash deposited twice a week were reflected
in the bank statement. She stated based on her knowledge, that there were no written
procedures related to the AEID operation for her to follow.

Ms. Toto stated that about a year ago she began to notice that she would physically see
a customer, for instance on a Monday, requesting an AEID but the next day (on Tuesday)
she would not receive a Daily Package and would be told by Ms. Pedemey that there was
no revenue from the prior day.

Based on these instances, Ms. Toto began having concerns and mentioned to her
supervisor at the time, and to Ms. Sejnoha (via an August 31, 2015 email), there needs
to be an SOG [Standard Operation Guide] for IDS [AEIDs].

OIG interview of Patricia (Ramirez) Aguilar, PSD Senior Clerk Typist

Ms. Aguilar has been employed by PSD since October 17, 2016. She reported to Ms.
Pedemey and her job duties include issuing AEIDs. She said that since she is new to the
position she had been undergoing training and during the first days of employment was
not given the key to the cash box. During her training, Ms. Pedemey processed most of
the AEIDs and Ms. Aguilar only processed a few. Ms. Aguilar stated since she was not
fully trained when she first started and she would not know at the end of the day how
many transactions were processed and how much cash should be in the cash box as a
result of those transactions. Therefore, Ms. Pedemey ran the report, did the cash
counting and prepared the reconciliation. Ms. Aguilar believes that the deposit slip was
also prepared by Ms. Pedemey but was not certain.

OIG Note: We found this to be the procedure. Ms. Pedemey ran the reports, did the cash
counting, prepared the reconciliation, and the deposit slips.

Ms. Aguilar stated that after a couple of weeks she was given the key to the cash box on
a daily basis, the procedure was that at the end of the business day she had to leave the
key holder containing both the key to the cash box and the key to the drawer, in a location
designated by Ms. Pedemey where it would remain overnight.

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OIG interview of Marianela Diaz, PSD Director Finance and Administrative Services
Ms. Diaz stated that on November 15, 2016, she met with Ms. Toto regarding Ms. Totos
concerns related to the AEID reconciliation form and only having one signature. During
this meeting, Ms. Diaz realized that she had access to the Daily Payment Activity reports
from the AEID database. Ms. Diaz ran a report for a recent period where the deposit had
been processed. She realized that there was a difference in the amount displayed on
the report from the AEID database versus the amount displayed in the Advantage6
system from the subsequent deposit. Ms. Diaz ran several more reports and
noticed differences in those amounts as well.

Ms. Diaz recalled that while she was meeting with Ms.
Toto, Ms. Pedemey came in and actually saw what I had
on the screen. Ms. Diaz said that within minutes Ms.
Pedemey who had submitted a Daily Payment Activity
report that morning, brought in a revised report with extra
cash attached to the revised report. Ms. Diaz recounted
that Ms. Pedemey said to Ms. Toto, I left you a revised
report on your desk, theres cash there. Ms. Pedemy
kept returning to Ms. Diaz office while she was meeting
with Ms. Toto. At the end of their meeting, Ms. Diaz
asked Ms. Toto to provide her the reports for the last six
months. Ms. Diaz wanted to review them before she
mentioned anything.

Ms. Diaz stated that in the early morning of November 17, 2016, she met with Ms.
Pedemey to discuss some issues that they had been having with the AEID operation
including issues with the system that caused ISS to get involved and issues with other
employees. Ms. Diaz explained that right after her meeting with Ms. Pedemey, Ms. Diaz
asked to meet with Ms. Sejnoha. Ms. Diaz told Ms. Sejnoha about the findings she made
during the meeting with Ms. Toto, about reviewing six months of transactions, and about
the conversation that she had with Ms. Pedemey. Ms. Sejnoha confirmed this meeting
with Ms. Diaz and the content therein.

Ms. Diaz said that after returning from her lunch on November 17, 2016, Ms. Diaz was
informed that Ms. Pedemey had been looking for her so Ms. Diaz went to see Ms.
Pedemey. Ms. Pedemey was crying and told Ms. Diaz that she had done something
wrong. Ms. Diaz told Ms. Pedemey that they should wait for Ms. Sejnoha to come back
in order to have a conversation and went back to her office. When Ms. Sejnoha returned,
both Ms. Diaz and Ms. Pedemey went into Ms. Sejnohas office and Ms. Pedemey
confessed to taking money and modifying the reports and asked to be forgiven. Ms.
Pedemey also stated to Ms. Sejnoha and Ms. Diaz that she had been doing this (taking
money and modifying the reports) for about a year.

6 The County utilizes CGI Advantage for financial management including purchase order processing.

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OIG interview of Stephanie Sejnoha, PSD Director

Additionally, Ms. Sejnoha stated that on November 17, 2016, Ms. Pedemey and Ms. Diaz
came into her office and during that meeting Ms. Pedemey voluntarily confessed that she
made a mistake and that she has been stealing money from the adult entertainment cash
collection that we have at the front of the EOC. Ms. Pedemey told Ms. Sejnoha and Ms.
Diaz that she knew it was wrong and that she was sorry. Ms. Pedemey also indicated
that her husband has been spending a lot of money at Home Depot.

Ms. Pedemeys Description of How She Circumvented the Internal Procedures

According to Ms. Sejnoha, Ms. Pedemey explained how she circumvented the internal
procedures. Ms. Sejnoha stated that at the end of the business day, the cash from the
daily transactions, as well as, the change funds remained in the cash box inside a locked
drawer and the keys were given to Ms. Pedemey. Then, Ms. Pedemey would run the
closing report (Daily Payment Activity) from the AEID database and downloaded it into a
PDF (portable document format) file. Subsequently, and before submitting the package
to the accounting section, Ms. Pedemey would manipulate the report by removing the
cash line(s) and removing the AEID application(s) associated with the cash line(s) that
Ms. Pedemey removed from the report. Ms. Sejnoha stated that Ms. Pedemey did not
manipulate anything from the AEID database because the system shows if a record is
deleted. Ms. Sejnoha stated that Ms. Pedemey said she had been doing it just this year.
Ms. Sejnoha thinks its longer based on the information Ms. Sejnoha received from Ms.
Diaz prior to Ms. Pedemeys confession.

Following Ms. Pedemeys confession to Ms. Sejnoha and Ms. Diaz, Ms. Diaz directed Ms.
Toto to pull additional Daily Payment Activity reports and the associated reconciliation
packages. Ms. Toto went back as far as February 2014. From February 2014 through
November 17, 2016 the difference between the database reports versus the hardcopy
reports submitted by Ms. Pedemey was over $27,000.

Analysis of Ms. Pedemeys Actions

OIG interview of Benjamin Perez, County ISS Systems Integrator

Mr. Perez stated that prior to his current position he was a PSD employee until 2012. He
recalled that around 10 to 12 years ago PSD converted the AEID issuance process from
paper to computer. Mr. Perez explained that the software used by the PSD to issue
AEIDs is a third-party software, intended to create badges with the use of a printer. He
modified the software to fit PSDs needs. Mr. Perez stated that the software is not safe
from a financial stand point because it is not designed to track financial transactions. He
further stated that the users do not have a unique username and password and he
believes an AEID may be printed and issued without saving the transaction in the AEID
database. Mr. Perez stated that the software tracks every change made in the database.
In addition, Mr. Perez stated that the user has the ability to make changes and or delete
transactions in the database. However, the changed or deleted transaction will still
appear in the Daily Payment Activity report because it is recorded on the audit log and
the user does not have access to that log. As a result, a user would have to request Mr.

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Perez or anyone having access to the audit log to delete a transaction. Mr. Perez recalled
that he received sporadic requests to make corrections and or deletions in the audit log.
Mr. Perez further explained that when he received requests to delete a transaction he
asked that the request be in an email and he saved the emails. Whenever he made the
change or deletion, he replied to the email containing the request. Mr. Perez explained
that once he deleted the transaction in the audit log, the transaction is gone. The
transaction can only be recovered by restoring a database back-up. However, he
believes the back-ups are only kept for about six months. Mr. Perez stated that there is
a security group within PSD that is allowed to run the Daily Payment Activity report and
Ms. Pedemey was one of the people allowed to do so. Mr. Perez believes that the export
tool option, given to users who have the ability to run the Daily Payment Activity report,
could be deactivated.

Mr. Perez was shown a Daily Payment Activity report submitted by Ms. Pedemey. He
stated that perhaps the report was not exported and subsequently modified. Mr. Perez
pointed out that all exported reports had the time stamp but this Daily Payment Activity
report did not. In addition, Mr. Perez looked at the letter I in the word Issued and the
$ after the word Total and noticed that the Daily Payment Activity report generated by
the AEID database and the Daily Payment Activity report submitted by Ms. Pedemey have
different fonts. Based on these two details, Mr. Perez suggested that the Daily Payment
Activity report submitted by Ms. Pedemey may have been recreated and not exported
from the AEID database.

$45,000.00

$40,000.00

$35,000.00

$30,000.00 AEID Fees Total

(per AEID database)
$25,000.00
AEID Fees Total
$20,000.00 (reported per review of
Daily Packages)
$15,000.00

$10,000.00

$5,000.00

$0.00
FY 2013- FY 2014- FY 2015- 10/1/2016 -
2014 2015* 2016 11/14/2016

We identified the first Daily Payment Activity report that reflects a discrepancy as the one
for the period of October 24, 2013 through October 28, 2013. The report submitted shows

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that only one AEID was issued during those dates; the report also shows a new card was
issued on October 28, 2013 and that the fee for the card was paid by using a Visa or
MasterCard (MC). The total in the report submitted with the deposit was $75.00. The
Daily Payment Activity report generated by the AEID database for the same period
(October 24, 2013 through October 28, 2013), shows that three new AEIDs were issued
during those dates. The AEID database report reveals that one of the cards was issued
on October 25, 2013 and the fee was paid by Visa/MC; the other two cards were issued
on October 28, 2013 and their respective fees were paid in cash. The total in the report
from the database is $225.00, a discrepancy of $150.00.

During our review of Ms. Pedemey's emails we noted various emails from the designated
Senior Secretaries covering for the Senior Clerk Typist when she was on breaks or not in
the reception area. The Senior Secretaries typically sent an email to the other Senior
Secretaries, the Senior Clerk Typist and Ms. Pedemey, with a scanned copy of any AEID
application that they processed. From those emails, we acquired 18 AEID applications
related to cash transactions that were excluded from the Daily Payment Activity reports
submitted by Ms. Pedemey.

Similar reviews/comparisons of all subsequent Daily Payment Activity reports submitted

by Ms. Pedemey with the AEID database reports revealed the following:
For fiscal year 2014, October 1, 2013 through September 30, 2014, we identified
at least 7 reports which were inaccurate and understated by at least $1,050.00
(including the $150.00 discrepancy referenced above for the period of October 24,
2013 through October 28, 2013) that were submitted by Ms. Pedemey.
For fiscal year 2015,7 October 1, 2014 through September 30, 2015, we identified
at least 31 reports which were inaccurate and understated by at least $6,325.00
that were submitted by Ms. Pedemey.
For fiscal year 2016, October 1, 2015 through September 30, 2016, we identified
at least 70 reports which were inaccurate and understated by at least $19,275.00
that were submitted by Ms. Pedemey.
For October 1, 2016 through November 14, 2016, we identified at least 7 reports
which were inaccurate and understated by at least $925.00 that were submitted by
Ms. Pedemey.

During the period of October 1, 2013, through November 14, 2016, Ms. Pedemey diverted
from PSD AEID fees a total of at least $27,575.00. We consider this amount to be
identified costs.8

We use the phrase at least above for the following reasons. As previously stated, Mr.
Perez said that he believes an AEID may be printed and issued without saving the
transaction in the AEID database. Our review of PSD records revealed that there was a
discrepancy between the Daily Payment Activity report for November 3, 2016 to
November 7, 2016 submitted by Ms. Pedemey and the report generated by the AEID

7 Due to a lack of PSD records, the OIG was unable to determine if funds were diverted during September 17, 2015
through September 23, 2015.
8 Identified costs are those dollars that have the potential of being returned to offset the taxpayers burden.

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database for the same period. The Daily Payment Activity report generated by the AEID
database for the above dates indicates that there were two AEIDs issued on November
3, 2016 with cash as the payment method; and, another two AEIDs issued on November
4, 2016 with Visa/MC as the payment method. The Daily Payment Activity report
submitted by Ms. Pedemey for the same period indicates that there was one AEID issued
on November 3, 2016 which was paid in cash and two AEIDs issued on November 4,
2016 which were paid by Visa/MC. We obtained from PSD, video surveillance recordings
of the reception area of the EOC from November 1, 2016 through November 17, 2016.9
We observed the video surveillance recordings for November 3, 2016 and November 4,
2016. On November 3, 2016, it appears that nine individuals came into the EOC to obtain
AEIDs. Ms. Hayes took care of two of the customers while Ms. Pedemey took care of the
other seven. On November 4, 2016, it appears that four individuals came into the EOC
to obtain AEIDs. Ms. Aguilar took care of two of the customers and Ms. Pedemey took
care of the other two customers. Based on the date and time stamp on the credit card
receipts and the date and time on the video surveillance, it appears that the two AEIDs
issued on November 4, 2016 with Visa/MC as the payment method were processed by
Ms. Aguilar.

Our efforts to determine an amount that Ms. Pedemey diverted to her personal use as it
relates to this allegation is based on the information in the AEID database as it compares
to those inaccurate and understated Daily Payment Activity reports submitted by Ms.
Pedemey. As you can see from our review of the video surveillance recordings for these
2 days, it appears that only 4 out 13 AEIDs that were issued are in the AEID database;
and, only 3 of those 4 were reported with accompanying payments by Ms. Pedemey.

Based on our review of EOC video surveillance recordings for these two days as they
relate to the information in the AEID database, we believe Ms. Pedemeys diversions of
funds may be much greater than what can be determined by the review of PSD records
alone.

9 EOC video surveillance recordings are kept for 30 days unless copied to an optical disk upon special request.

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Allegation (2):
Public Safety Department Administrative Assistant Anita Pedemey did not comply
with the Public Safety Departments Receipt of Cash policy in order to divert
donations/payments made to the Victim Services Fund for her personal use. If
supported, the allegation would constitute a violation of Section 7.02 D, (1), (2), (14),
(17), (24), (32), (33), and (36) of the Palm Beach County Merit Rules and Regulations,
a violation of Department of Public Safety Department Receipt of Cash policy and
procedure (PPM PSF-005) and a potential violation of Florida Statute 812.014(1)
and (2)(b)1.

Finding:
The information obtained supports the allegation based on the OIG review of records,
statements made by donors who were contacted, and witness interviews. Ms. Pedemey
was not interviewed due to the referral to the Countys State Attorneys Office.

OIG interview of Ms. Diaz

Ms. Diaz said that on November 17, 2016 in the morning and prior to her confession, Ms.
Pedemey gave her a letter of receipt10 with three $100 bills and told her that was a cash
donation made to Victim Services and it needed to be deposited. Ms. Diaz gave the letter
of receipt and the cash to Ms. Toto, who was surprised because she never receives cash
donations for deposit from VSD for the VSF.

Ms. Diaz stated that Ms. Pedemey had access to a network drive, where an employee of
VSD has kept an Excel spreadsheet containing a list of the donations (including cash
donations) that have been made since August 2015. Within the Excel spreadsheet are
hyperlinks11 that would connect to a letter of receipt given to the donor, and copies of the
checks if the donor paid with a check. Ms. Diaz stated that as far as she knows, Finance
and Administrative Services has never received cash from donations made to VSD for
the VSF. Ms. Diaz stated Ms. Sejnoha told her that cash (a little over $4,000) resulting
from donations to the VSF was missing.

OIG interview of Nicole Bishop, PSD Director Justice Services

Ms. Bishop explained that her previous Senior Secretary, Stacey English, used to hand-
deliver the donations made to the VSF to the EOC in order for them to be deposited and
then Ms. English provided a copy of the letters of receipt to one of the Justice Services
Supervisors, Holly Dibenedetto. Ms. Bishop explained that when Mildred Triana started
working as her Senior Secretary, without Ms. Bishops knowledge, Ms. Pedemey
instructed Ms. Triana to mail the cash donations directly to her (Ms. Pedemey) via inter-
office mail. Ms. Bishop stated that she became aware Ms. Triana had been sending the
cash donations via inter-office mail to Ms. Pedemey after Ms. Pedemeys voluntary
admission to Ms. Sejnoha and Ms. Diaz.

10 A letter provided to a VSF donor that includes the amount of the donation/payment, a case number (if applicable),
and the signature of the VSD staff receiving the donation.
11 A link to another location or file, typically activated by clicking on a highlighted word or image on the screen.

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Ms. Bishop explained that the donations made to the VSF were not being recorded into
any particular computer system but were being documented by Ms. Triana in an Excel
spreadsheet. Ms. Bishop stated that since Justice Services has been trying to go
paperless, they began to scan the letters of receipt with the original hardcopy given to the
donor. The scanned images were stored on a network drive with hyperlinks to the
scanned images in the Excel spreadsheet maintained by Ms. Triana.

OIG interview of Mildred Triana, PSD Justice Services Senior Secretary

Ms. Triana explained that when she started working in this position, Ms. Pedemey trained
her. During the training, Ms. Pedemey showed her where the donations file was within
the network drive and trained and/or instructed Ms. Triana to send her the donations and
related documentation via inter-office mail. Ms. Triana clarified that upper management
was aware that she had been trained and/or instructed by Ms. Pedemey to send the
donations and related documentation via inter-office mail.

Ms. Triana explained that the Main Judicial Center receives the majority of the donations
made to the VSF. She related that she adheres to the following procedures as instructed
by Ms. Pedemey when she receives the donations/payments:
The information and/or court document(s) provided by the donor is used to prepare
a letter that includes the amount of the donation/payment, a case number (if
applicable), and the signature of the VSD staff receiving the donation.
The original letter is given to the donor and a copy is kept by the VSD staff as a
record. If other VSD branches receive a donation they send the donation and copy
of the letter to Ms. Triana via inter-office mail.
She scans the documents (the copy of the letter from the above step, court papers,
and copy of the check, if applicable) and enters the donation in the Excel
spreadsheet she created when she started in this position. She explained that the
Excel spreadsheet contains the following information: (1) item received (i.e.
donation); (2) date the item is received; (3) name of the file; (4) date that the item
is mailed out; (5) the hyperlink and (6) the amount (if the item is a donation).
She then uses inter-office mail to send the donation (actual cash/check/money
order) along with the copy of the letters/receipts to Ms. Pedemey at the EOC in a
closed envelope labeled Confidential.
After she mails the closed envelope, she sends an email to Ms. Pedemey to inform
her she will be receiving donations.

Ms. Triana stated that she was unable to give an amount for the cash that was derived
from donations/payments. However, she said that the amounts of cash missing can be
tracked by adding up the amounts listed in her Excel spreadsheet.

Ms. Triana provided the following documents:

Hardcopies of emails between her and Ms. Pedemey in reference to VSF
donations where she informed Ms. Pedemey those donations were sent via inter-
office mail.
Hardcopy and electronic copy of the Excel spreadsheet she has maintained for the
donations since she started working in this position.

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Our review of the Excel spreadsheet maintained by Ms. Triana revealed that the
spreadsheet has three tabs: 2015, 2016, and 2017 but the 2017 tab does not have any
data. The donations listed in the 2015 and 2016 tabs do not include a column that
specifies the method of donation (i.e.: cash, money order or check). Some of the columns
on the 2015 and 2016 tabs are: Date Sent Out which is the date when the donation was
sent via inter-office mail; Sent to which has the name and place to whom the donation
was sent via inter-office mail; and, Comments which has the hyperlink to the scanned
images with the path of the hyperlink visible.

The 2015 tab has 27 donations from August 18, 2015 through December 14, 2015 totaling
$5,700.56 excluding one of the 27 where the amount of donation is not listed; hyperlinks
for eight of the donations listed in the 2015 tab were not working properly because the
PDF files are no longer stored on the network drive.

The 2016 tab has 66 donations from January 5, 2016 through November 14, 2016 totaling
$12,146.39; none of 66 hyperlinks were working properly because the PDF files are no
longer stored on the network drive.

The OIG requested assistance from ISS in an attempt to recover the PDF files associated
with the cash donations. ISS was able to recover 47 of the 66 PDF files missing for 2016
donations but they were not able to recover the eight PDF files missing for 2015
donations.

The 47 PDF files that were recovered by ISS (for 2016) were reviewed and revealed the
following:
30 donations were made by check;
14 donations were made by money order; and,
3 donations totaling $650.00 appear to have been made with cash since the PDF
files recovered do not include images of a check or a money order.

An email sent by Ms. Triana to Ms. Pedemey on September 14, 2016 saying: Good
morning Anita Im sending you a cash donation Thanks confirmed that one of those three
donations was a cash donation ($200.00).

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Further review of Ms. Trianas emails, disclosed two additional cash donations associated
with broken hyperlinks; one from 2015 and the other from 2016.

An email sent by Ms. Triana to Ms. Pedemey on September 8, 2015 saying: Good
morning Anita Im sending a cash donation today Thank You confirmed a cash
donation ($100.00).

An email sent by Ms. Triana to Ms. Pedemey on June 13, 2016 saying: Good morning
Anita Im sending you a cash donation Thanks confirmed a cash donation ($250.00).

For the remaining 24 unrecoverable hyperlinks, the OIG researched the case numbers
listed in the Excel spreadsheet in the County Clerk & Comptroller database. Through this

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research, names and dates of births of the donors were obtained and additional research
was conducted to obtain the donors telephone numbers.

The OIG attempted to contact 19 donors, 3 of them confirmed that the donation they made
to the VSF was in cash. However, only one of the three donors provided the OIG with the
letter of receipt from VSD.

The OIGs review disclosed that the records submitted to Finance and Administrative
Services by Ms. Pedemey during the period of August 18, 2015 to November 14, 2016
related to VSF donations/payments were incomplete and understated by at least
$4,605.00. $1,300.00 of these donations/payments we have identified as cash. The
remaining $3,305.00 could not be identified as cash donations/payments due to a lack of
supporting documentation or testimony. Nevertheless, based on statements from
Finance and Administrative Services employees they were not deposited.

We consider the $1,300.00 to be identified costs and the additional $3,305.00 that was
never deposited to be questioned costs.12

Ms. Bishop stated that a new County Victim Services Program Standard Operating
Procedure (SOP) was created after the incident with Ms. Pedemey and has been put into
effect. The SOP requires that the division use a numbered receipt book that will
correspond to the letter of receipt. She also stated that per the new SOP, a safe has been
acquired to store the donations and an armored car vendor is now picking up the deposits
directly from VSD.

12 Questioned costs can include costs incurred pursuant to a potential violation of a provision of law, regulation, contract,
grant, cooperative agreement, or other agreement or document governing the expenditure of funds, and/or a finding
that such costs are not supported by adequate documentation, and/or a finding that the expenditure of funds for the
intended purpose is unnecessary or unreasonable in amount. As such, not all questioned costs are indicative of
potential fraud or waste.

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ADDITIONAL INFORMATION

Possible Access to Additional PSD Cash Fees by Ms. Pedemey

We reached out to management of the remaining PSD divisions: 9-1-1 Program, Animal
Care and Control, Consumer Affairs, and Emergency Management to determine if they
collected cash for any of their operations; and if so, was Ms. Pedemey involved in the
processing/handling of those cash fees. Based on the information obtained during our
conversations with each of the aforementioned directors/managers, it was determined
that there was a possibility that Ms. Pedemey had access to cash from fees paid to the
Emergency Management divisions Comprehensive Emergency Management Plan
Review Program (CEMP). Our review of the CEMP records shows that $883.75 in cash
was collected from October 1, 2013 through November 14, 2016. Based on the amount
of cash collected in CEMP fees, as well as, statements from Mr. Perez and Ms. Morrissey
that Ms. Pedemey did not have access to this cash we did not investigate this matter any
further.

Review of Ms. Pedemeys Emails and Internet History

During her confession to Ms. Sejnoha, Ms. Pedemey indicated that her husband has
been spending a lot of money at Home Depot. We did not review Ms. Pedemeys
personal finances for this investigation. However, we did review her work email and
internet history.

Ms. Pedemeys work email and internet history did not contain any information about her
husband. A few of Ms. Pedemeys personal emails (using her County email account)
referred to a house in France, one email stating, I do not have anything in savings to
cover anymore as I had to send everything to France for the roof!

IDENTIFIED AND QUESTIONED COSTS

Identified Costs: $28,875.00

Questioned Costs: $3,305.00

RECOMMENDED CORRECTIVE ACTIONS

The OIG recommends that the Countys PSD:

1. Take appropriate personnel actions.

Ms. Pedemey resigned during the OIG investigation. Therefore, we consider this
recommendation closed. The County may be able to recoup misappropriated
funds.

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2. Consider only accepting checks, money orders, or debit/credit cards as payment

methods for the AEID fees and the donations/payments made to the VSF.
Approximately 70% of the fees for the AEIDs are collected in cash, a higher fraud
risk.

3. In the event that PSD continues to accept cash as a payment method for the AEID
fees and VSF donations/payments, PSD should consider establishing additional
internal controls and methods of supervisory review to safeguard the cash and
establish responsibility in case of loss or shortage.

During the course of the investigation, the PSD created a new SOP for its VSF
donations/payments; the SOPs (ADM 005 Receipting of Donations) purpose is
to provide direction to the staff responsible for receiving and processing financial
donations made to the Victim Fund to ensure compliance with the County policy
and general accounting practices. The SOP establishes that cash donations will
be accepted at the Central Courthouse but cannot be accepted at any field or
annex courthouse location. The SOP also establishes that in addition to preparing
an Acknowledgement of Donation Letter, the Central Courthouse Secretary has to
record the donation information, such as donor name, amount and type of donation
(cash, check, or money order) in a sequentially numbered office receipt book.

Furthermore, the SOP establishes the following: two people (the Central
Courthouse Secretary and the Senior Secretary) verify that the cash, checks, and
money orders match the Cash Reconciliation sheet and will be required to sign off;
the Senior Secretary prepares a deposit and puts together a deposit bag; the
deposit bags needs to be stored in a secured cabinet until it is picked-up by the
Countys armored car vendor.

4. Deactivate the ability to export the Daily Payment Activity report from the AEID
database.

5. Consider establishing a SOG wherein the cardstock utilized to print the AEIDs is
reconciled with the Daily Payment Activity report from the AEID database as a
method of double checking.

ACKNOWLEDGEMENT

The Investigations Division would like to thank the PSD staff for their cooperation
throughout this investigation. We would also like to thank the ISS staff for their assistance
in providing, and in some cases recovering and providing, records needed for this
investigation.

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RESPONSE FROM MANAGEMENT

Pursuant to Article XII, Section 2-427 of the Palm Beach County Code, on March 15,
2017, Anita Pedemey and the Palm Beach County Public Safety Department were
provided the opportunity to submit a written explanation or rebuttal to the findings as
stated in this Investigative Report within ten (10) calendar days. On March 24, 2017, PSD
provided their response. As of the date of this Final Report, neither Ms. Pedemey nor her
representative responded. The PSD written response, in its entirety, is attached to this
report.

PSD concurred with the OIGs Recommendations and advised the following:
Effective May 1st, 2017 cash will no longer be accepted as payment for AEID
transactions. Donations to the Victim Fund will continue to be accepted in the form
of cash, check, or money order. However, a new Standard Operating Procedure
(SOP) has been implemented.
Saving or printing the Daily Payment Activity report as a PDF document cannot be
restricted or limited; however, the department will continue to work with ISS on the
AEID database.
The department will implement a process to reconcile the inventory of blank ID
cards to the Daily Payment Activity report.

This Investigation has been conducted in accordance with the ASSOCIATION OF

INSPECTORS GENERAL Principles & Quality Standards for Investigations.

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