KNOXVILLE, Tenn. — In an April 2023 email to Knoxville's Chief Operating Officer, David Brace, Knox County Rescue Squad Executive Director Julie Greene said the squad had identified situations where a "former employee may have misappropriated funds." Greene said in the email KCR filed a notice of fraud with the Tennessee Comptroller's office.
Through a May 2023 board meeting recording, obtained through an open records request, WBIR learned KCR thought the former employee misappropriated at least $11,000 over the previous two quarters.
"I think everybody knows that our agency has suffered some fraudulent activity by a previous employee," Greene is heard saying on the recording from May 11, 2023. "We're figuring out what we feel like is fraud, and putting that together in packet form for the county staff to review."
According to the recording, KCR staff believed the fraud began in 2018. They believed the former employee used Knox County Rescue Squad credit cards and fuel cards for the fraud.
"She was able to get around our dual signature control effects by using the bank account to pay bills via eCheck," a KCR leader is heard saying on the recording.
WBIR reviewed the personnel file of the former administrative financial assistant for the Knox County Rescue Squad, through an open records request. The file said the former employee was hired to work for the rescue squad in December 2017. Her job description included reviewing and approving purchasing and accounts payable transactions, the personnel file shows.
On January 27, 2023, that employee sent an email to KCR leadership, announcing she would "look for other opportunities." She pledged to assist the rescue squad during "a transitional period," an email in her personnel file showed.
On March 30, 2023, a board member emailed that employee and asked for her list of duties, a list "we've asked you for several times," an email in her file said. The same email said KCR was transferring ownership of the bookkeeping accounts to a new accounting firm.
Less than a month later on April 27, 2023, Greene sent an email to Brace notifying him of the financial discrepancies.
On Feb. 1, 2023, an email from Knox County Auditor Richard Pugh showed he did not find any "evidence to substantiate the claims against KVERS.". Pugh, however, said he saw "some processes in the KVERS control environment that would put your organization at risk," he said in the email.
"The lack of a proper inventory tracking system opens KVERS up to risk that could include fraud or abuse," Pugh said. "Best practices direct uploading receipts in a computer format to allow for quick access, add an additional level of security, and a more robust records storage process."
Through their attorney, Knox County Rescue Squad provided two statements in regard to the fraud. Those statements are available below.
"Knox County Rescue faces challenges that affect many non-profit entities. Ebbs and flows in fundraising and reduced volunteer hours have affected us as they have many other charitable organizations. Recent discoveries involving a former employee have made some of these issues more challenging than usual, but at no point has Knox County Rescue’s ability to respond to emergencies been compromised by this investigation. We look forward to a conclusion of the Comptroller’s investigation."
"KCR acknowledges there have been discussions about reimbursing County funds that can be identified as misappropriated by its former employee. Since an investigation is ongoing no final determination has been made concerning the amount of any reimbursement that may be due."