Wednesday, October 28, 2009
sponsored by Graue Inc.

What happened in City Hall

Part 1: Clerk covers embezzlement with complicated system

Send a link to a friend

[October 17, 2009]  Feb. 9, 2009, was a dark day in the history of Lincoln city government, as the residing city clerk, Melanie Riggs, tendered her resignation effective immediately. Her resignation was in light of a state investigation that at that time was being labeled as an investigation into check fraud.

City officials, department heads and staff were immediately advised that they should not speak to anyone concerning the case, and for several months the public has been left to speculate on what happened and how it came about.

Riggs came to city government in 1988 from Abbott & Phillips, where she had worked in their accounting and computer departments.

She worked under Nita Josserand, veteran city clerk, and when Josserand announced her retirement in 2003, halfway through an election term, Riggs was appointed to fill the vacant position.


At the next general election, in 2005, Riggs ran unopposed and won the position for what would be her only elected term in office.

In 2009 she was on the ballot again, unopposed. But her aspirations of being re-elected were cut short when on Feb. 9, a visit from state police investigators to City Hall prompted the clerk's immediate resignation. The news was a shock to everyone at City Hall and to the community as well.

During her career in city government, Riggs became an active member of the Central Illinois Municipal Clerks Organization. Her history with the organization included serving as its treasurer for four years, between 1997 and 2000, and secretary in both 2001 and 2008.

In November of 2000 Riggs was elected secretary of the organization for the coming year. In a letter to the Lincoln City Council, Peoria City Clerk Mary Haynes praised Riggs for her exceptional leadership skills and said, "The city of Lincoln is fortunate to have her as its deputy city clerk."

Additionally, Riggs received the organization's Presidential Award in 1997, 1998 and 2001, and was elected as their vice president for the 2009 year.


Despite all those accolades, on Sept. 24, Melanie Riggs entered a plea of guilty to charges of embezzlement. The charges relate to a period of time between midyear 2007 and the end of January 2009, during which she embezzled a minimum of $46,650 from the city coffers.

The question comes to mind: How could anyone steal an average of $2,500 per month from any business and no one notice it?

According to the residing city clerk for the city of Lincoln, Denise Martinek, the means by which money was removed from the city books was quite complicated. She said: "This was not a matter of a big pile of money laying in a safe somewhere and her grabbing a few dollars out of it. She had a very complicated system."

The "system" involved 25 to 30 checkbooks, multiple copies of checks, a certain amount of money floating from one account to another, a computer software system that was not being kept current and not being fully utilized, a lack of checks and balances in the bookkeeping system, and perhaps just a little too much trust on the part of city officials.

As Martinek discussed the matter, she pulled documents from a thick folder to illustrate how the crime was perpetrated. In one hand she held a copy of a check made out in the amount of $1,200, in the other hand a second copy of the same check. The difference in the two copies: one made out to (name withheld) and on the other, the payee line left blank.

Both copies showed that the check had been handwritten and signed by Melanie Riggs. In addition, the second signature was that of Les Plotner, city treasurer, but it was a signature stamp, not a real signature. The stamp used was in Riggs' possession and she used it at her discretion.

Martinek explained that Riggs wrote and signed the check, leaving the payee blank, then copied the check and wrote in the payee on the copy as (name withheld).

On the real check, she then made the payee "The city of Lincoln," took it to the bank and cashed it. The cash, however, never made it back to the city.


Martinek said that as far as the payee was concerned, the clerk was paying a bill that didn't exist. While there were a variety of payees named on the checks, using a business as an example, Martinek said that when the check was written, there was no bill from that company and no amount due.

Riggs wrote and cashed checks in this manner on several of the city's bank accounts. Martinek also said there was a certain amount of money that was floating from one account to another.

This is called kiting, and it happens when a check is written on account 1 to cover a check that was written on account 2. Then another check would be written on account 2 to cover the check that had just been written on account 1.

What it boils down to is that the money doesn't really exist. It is just a matter of deposits and withdrawals hitting the bank in a perfectly timed fashion so that none of the accounts overdraw.

Riggs was able to hide what she was doing because for the most part she exercised complete control of these bank accounts. She made the deposits, wrote and signed the checks, made many of the entries involving these checks in the computer herself, and reconciled the bank statements each month with only minimal and guarded assistance from her staff.

[to top of second column]


In addition to all this, the onset of the federal Check 21 law in 2004 meant that at best, the city was getting a very small copy of the front only of their canceled checks, and nothing that showed who endorsed or cashed the check, making it all that much harder for anyone to realize something was awry.

When the state investigation began, it was followed closely by involvement from the FBI. Martinek said that the FBI became involved due to the likelihood that at least one of the accounts Riggs was embezzling from contained money received through a federal grant.

She went on to say that because of the vagueness of some of the deposits on the official books, it took a while to figure out for sure whether or not there were federal dollars involved, but the answer came in the form of the Fifth Street Road project.

Martinek said that even though the FBI had been diligently looking for the right connection, it wasn't until after she had been elected and sworn into office that they finally found the piece of evidence they needed.

It was an agreement between Lincoln and Logan County that the two entities would work together to improve Fifth Street. Martinek said she knew the document existed but couldn't find it anywhere in the clerk's office files, so she finally called Bret Aukamp with the county and asked him if he had a copy, and he did.

He sent it to Martinek, and from that document she was able to establish a timeline and start tracking down the money. Once she found the grant funds, she also had to assist the FBI in locating checks that had been written during the same time frame as Riggs' alleged embezzlement.

Again, from her large file folder she pulled out a page with several checks listed that were written between July of 2007 and January of 2009 and made out to the engineers who have continually worked on the Fifth Street project.

These were legitimate checks for legitimate services rendered and proved that while Riggs was stealing money from the city's general operating fund, there were federal dollars in that account.

On Sept. 28 the United States Department of Justice issued a press release saying that Riggs had pleaded guilty to embezzlement and would be sentenced on Feb. 1, 2010.


In the days that followed, Mayor Keith Snyder issued the following written statement:

I am glad that this sad chapter at City Hall is drawing to a close. The taxpayers are fortunate in that at least a portion of the money that was stolen will be repaid.

The heroes in this story are the people who uncovered the wrongdoing and brought it to light: City Clerk employees Susan Gehlbach, Brenda McCabe, Doris Anderson, and City Treasurer Les Plotner. They have had to sit by quietly throughout this prolonged investigation and provide all of the city records and information that enabled the federal government to bring Ms. Riggs to justice.

Over the past eight months they have continued to provide their usual excellent service to the citizens of Lincoln while dealing with the deception, disappointment, and frustration of the prior City Clerk's actions. We are fortunate to have Susan, Brenda, Doris, and Les as public servants in Lincoln.

There have been a number of operational, financial, and technology changes made to safeguard against this type of thing happening again. All of us at City Hall are committed to not only abiding by the law, but being the best stewards possible with the resources entrusted to us by the taxpayers.

Martinek says that who discovered this deception, and how, is not nearly as important as the fact that it was discovered and acted on quickly. She added that she and her staff will not be commenting on the events that led up to the state investigation.

She said that what does matter is that the crime was uncovered, and in doing so, it was determined first of all, that no other member of city government was involved; and secondly, it became a stark reality some changes needed to be made in the way the city's finances are handled.

Coming in Part 2 of this article, Martinek discusses what is taking place in City Hall now to assure that taxpayer dollars are protected against any future similar incidents.



Previous related articles

< Top Stories index

Back to top


News | Sports | Business | Rural Review | Teaching and Learning | Home and Family | Tourism | Obituaries

Community | Perspectives | Law and Courts | Leisure Time | Spiritual Life | Health and Fitness | Teen Scene
Calendar | Letters to the Editor