Susan Duffy, a former employee from the Westfield City Collector’s Office, leaves US District Court in Springfield with her lawyer Thomas A. Kokonowski after pleading guilty to charges of embezzling $110,000 from the City of Westfield. Duffy will be sentenced March 27, 2013. (Photo by chief photographer Frederick Gore)
WESTFIELD – City officials attended the Susan Duffy hearing yesterday in U.S. District Court in Springfield, where the former city employee admitted to stealing more than $110,000 between 2008 and 2011 when she was fired for fiscal malfeasance.
Duffy will appear in federal court at 2 p.m. on March 27, 2013 to be sentenced for the theft and for failing to pay income taxes on the money she stole from the city.
City Attorney Susan Phillips said that Duffy, under the terms of the plea agreement, will have six months to negotiate and accept a payment plan to reimburse the city for a total of $110,278. Federal regulations set the broad parameters for that payment plan and those of the Internal Revenue Service, which is seeking to recoup $30,800 from Duffy, although the hottest part of that negotiation may be between the city and the IRS to see which entity gets paid first.
Phillips said the Law Department will continue its investigation of assets Duffy may have hidden during the 2008-2011 time frame in which she skimmed $110,000 from the city’s coffers.
City officials said that it is unclear why Duffy stolen the municipal funds or how she spent the money because there was no significant change in her lifestyle during those years.
Mayor Daniel M. Knapik said the plea agreement completes a painful time for the city and its residents.
“This plea agreement should restore confidence in the community that their money is well cared for by city government,” Knapik said. “This theft was the result of an incredibly complex scheme. It’s hard to imagine that she kept it up that long.”
“We thought we had a good system in place, but this individual found a way around it,” Knapik said. “We have taken steps to put in proper procedures for reconciliation” of revenue received each day in the Collector’s Office.
“Changes were instituted immediately following our own internal review,” Knapik said. “We needed and continue to need to modernize the collector office with technology.”
Collector Michael McMahon said that his staff was called upon to double their collective efforts after the theft scheme was discovered in 2011, working their normal duties, as well as working with auditors and criminal investigators assigned to the embezzlement case.
“We caught this (theft) ourselves,” McMahon said. “All of the proper procedures were being followed and we learned from what happened. We changed the procedures to prevent it from happening again. My employees were outstanding working at a very stressful time.”
“This brings it to a final resolution,” McMahon said of the plea agreement in which Susan Duffy admits and explains how the scheme, very similar to a Ponzi scheme, worked.
