Detective Sgt. Brian Hoelzel leafs through a three-ring binder filled with nearly 800 pages of photocopied checks, invoices, receipts and spreadsheets.
It represents the year he and City Treasurer Jean Peterson spent following a complex paper trail that led to Jim Ash’s conviction for embezzlement on April 21.
When the former director of Waupaca’s Park and Recreation Department resigned a year ago, city officials were only aware that $400 had been taken from a drawer at the Park and Rec office.
Hoelzel’s investigation subsequently uncovered that Ash stole an estimated $171,350 since March 2005. That figure is the total amount within the statute of limitations and represents what the city will seek in restitution at Ash’s sentencing Wednesday, June 29.
Altogether, Ash is suspected of stealing nearly $200,000, most of which was siphoned through the Waupaca Recreation Association Participants checking account that Ash controlled independently of the city. The account had been set up by the softball association to handle fees and donations.
Hoelzel explained that the city budgeted and paid for Park and Rec equipment. Ash received donations for the same equipment, and deposited those donations into the association’s account.
“The people who donated money to the association’s account received the services and equipment they paid for, but the city also paid for the same purchases,” Hoelzel said.
According to the criminal complaint, Ash wrote checks from the association’s account to his wife, forged her endorsement on the check, and deposited them into his personal account.
“We had to review and document every check and every deposit that was made in the Waupaca Recreation Association’s account going back to 2004,” Hoelzel said. “We found 202 checks written to Lisa (Ash’s wife) that totalled over $174,000 from 2004 to his resignation in 2010.”
Hoelzel said he and Peterson also went through the monthly statements of the city’s account, then tried to match up checks with vendor invoices. Then they linked the purchases that the city paid for with donations deposited into the association’s account for the same items.
“Jean (Peterson) had to go through the city’s financial records to find the vendor, then contact the vendor for their records,” Hoelzel said. “The city also had to check its inventory to see that we had actually received the item.”
Hoelzel said he interviewed about a dozen vendors. Each one needed to find records for a specific purchase that may have been made six years earlier.
“Not all of the companies had their records on computers, so it took them some time to find the documents we needed,” Hoelzel said.
Hoelzel pointed to the example of a pitching machine that the city purchased in the spring of 2009. The machine had been approved in the city budget and the city had been invoiced for one machine at $1,978.
Hoelzel verified that the city had paid for the machine and that one machine had in fact been delivered to the city.
He also found while reviewing the association’s account that a short time after the city received the machine, an association check for $3,957 – double the amount of the machine – had been deposited into Ash’s personal account.
Hoelzel said the city did not have authority over the association’s account and was unaware that it existed prior to the start of the investigation.
“The account was started a long time ago for the men’s and the women’s softball associations. When I started investigating the account, I found another person who had signatory authority, but did not even know her name was still on the account,” Hoelzel said.
Although this was not the first embezzlement case that Hoelzel has handled, he said it was the largest and most in-depth investigation in his 18 years as a Waupaca police officer.
He received guidance from the state Department of Justice and met several times with local prosecutors to ensure that they had what they needed to prove the charges if the case went to trial.
In addition to reviewing all the funds that went into and out of the association’s account, Hoelzel also had to subpoena Ash’s personal accounts to determine how he was spending the money.
“When you have all these accounts, and all these different organizations, businesses and financial institutions to interview and obtain documents from, it takes a lot of time,” Hoelzel said. “We’re not a large department. There’s day-to-day operations and other criminal investigations.”
In addition to purchases for which both the city and donors paid, Hoelzel found evidence that Ash reimbursed himself for purchases that were never made.
For example, a $3,400 check from the association’s account was deposited into Ash’s personal checking account. The check’s memo line read, “ASA Team Insurance 34 teams.” City officials, however, were unable to find any records of ASA insuring any of the teams.
Hoelzel said he was still collecting documents as recently as April, just prior to his interview with Ash.
“Prior to interviewing a suspect in any case, I need to know all the answers prior to questioning the suspect so that I know what is true and what is false,” Hoelzel said. “That’s how you allow the suspect to bury themselves.”
He said the interview with Ash lasted a few hours and Ash was initially not forthcoming.
“Then I started presenting the checks and all the documentation in the binder,” Hoelzel said. “He then acknowledged that all the checks to his wife were fraudulent and that she had no knowledge of it.”
Hoelzel said Ash’s confession, along with the city’s thorough documentation, made conviction a near certainty. He also noted that Ash spared his family a long and public ordeal by waiving his rights to a preliminary hearing and a jury trial and pleading no contest at his initial court appearance.
He said the investigation also found that over time Ash paid back more than $14,400 to the association’s account.