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Teton School District #401 fraud investigation continues

At a special executive session of the board of trustees for Teton School District #401 Friday, board members discussed the status of the ongoing investigations into a fraudulent payment of $784,000, transferred to an account in error on Dec. 20.

The money, intended for Headwaters Construction, came from funds that are part of the state-held school-bond account.

Superintendent of Schools Monte Woolstenhulme says the district is cooperating with the FBI and with the district’s insurance carrier, Idaho Counties Risk Management Program, which is also investigating the case, an internal investigation of the case is also ongoing.

The school bond projects are continuing and the district has been in close communication with Headwaters.

Additional security measures have been taken to safeguard the distribution of public funds entrusted to the district, according to board chair Chris Isaacson.

These steps, including greater oversight by the board, will be applied to all financial transactions of the district, not just those related to the bond project.

“We are taking diligent steps as far as protocols and procedures go to make sure this kind of thing doesn’t happen again,” Isaacson said.

As a result of the incident, business manager Carl Church has been removed from that position, and in the short-term, the district will bring in accounting professionals to assist the district in processing payments and handling financial affairs of the district.

Woolstenhulme also says the fraud case has been reported to the Idaho State Department of Education and the Idaho State Treasurer’s Office, where bond funding resides.

The district says while the investigation is underway many details of the case cannot be released.

Updates about the case will be made at each regularly-scheduled meeting of the board moving forward, including the board’s next regularly scheduled meeting on Monday, January 14, at 5:30 pm.

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