LINCOLN — Nebraska State Auditor Mike Foley says recent audit work has uncovered alleged financial improprieties involving five local government entities, including more than $10,000 in utility payments that appear to have gone missing in the Village of Merriman.
According to Foley’s office, auditors reviewing Merriman’s fiscal year 2025 audit waiver request identified $10,225.96 in recorded utility customer payments that were never deposited into the village’s bank account.
The auditor’s office said the village clerk, who also worked at a local bank and community post office, may have either kept cash payments or periodically deposited funds into personal bank accounts on which she was an authorized signer. The questioned amount also included a $204 credit applied to the clerk’s own utility account, despite no corresponding payment being identified.
Auditors initially found no cash utility receipts deposited into village bank accounts during the fiscal year. The clerk reportedly told auditors that Merriman did not accept cash utility payments and required customers to pay by personal check or money order.
However, several utility customers told auditors they had paid their monthly bills in cash.
The clerk later claimed to have discovered several missing customer checks and said they had been deposited into the village’s general checking account. When auditors requested copies of the deposit slip and checks, the clerk provided the deposit slip but declined to provide images of the checks, citing bank privacy policies.
Auditors later contacted another bank representative and learned the deposit consisted entirely of cash and included no customer checks.
Foley’s office said the clerk appears to have misappropriated the $10,225.96 and provided false information to auditors in an effort to hinder the investigation. The matter was forwarded to the Nebraska Attorney General, the Nebraska State Patrol, and the Nebraska Accountability and Disclosure Commission for further review. According to Foley, a State Patrol investigation remains ongoing.
The Merriman case was one of five recent audit examinations highlighted by Foley’s office.
In the Village of Herman, auditors identified 39 allegedly personal purchases totaling $2,029.76 made with a municipal credit card. Items included an electric toothbrush, medications, toiletries, and shampoo. The clerk had reimbursed the village $784.32 before auditors began asking questions, leaving $1,245.44 in disputed purchases that had not been reimbursed.
That matter was forwarded to the Nebraska Attorney General, the Washington County Attorney, and the Nebraska Accountability and Disclosure Commission.
In the Village of Alvo, auditors found four questionable electronic debits totaling $30,273.06 from the village’s Road Fund account in August and September 2025. Village officials said the board did not authorize the transactions. The auditor’s office said the village failed to immediately close the compromised account, allowing additional suspicious withdrawals to occur.
In David City, the former city clerk and treasurer allegedly misappropriated more than $5,800 through personal credit card purchases and unauthorized salary increases. Auditors identified $914.63 in allegedly personal purchases and $4,983.01 in wages paid above the authorized amount between January 2021 and October 2025. The case has been referred to the Nebraska State Patrol and remains under investigation.
The Plains Historical Society in Kimball County was also included in the auditor’s review. A former board member and secretary allegedly used the organization’s debit card for 54 personal purchases totaling $1,386.43. The money was later reimbursed, and the former board member pleaded guilty to misdemeanor theft by deception in March 2026 and was fined $100.
Foley said the cases demonstrate the importance of audit waiver reviews in detecting potential misuse of public funds.
“This series of audit findings is both disheartening and instructive,” Foley said, adding that the cases serve as a reminder that constant vigilance is necessary to prevent fraud and theft involving taxpayer money.
Nebraska residents can report suspected fraud, waste, or abuse involving government funds through the State Auditor’s hotline at 1-800-842-8348 or 402-471-3686. Reports may be submitted confidentially.
