On February 3, potential fraudulent transactions were discovered in the Kern Community College District and the Kern County Superintendent of School’s clearing bank accounts. Working with our bank, Wells Fargo, and the two districts involved, the fraud was confirmed.
As soon as the fraud was detected, an independent criminal investigation was initiated and is underway through local and federal authorities to catch the perpetrators of this crime. Because of the ongoing investigation, the information that can be shared is limited.
The Treasurer confirms that this fraudulent activity was isolated to the two districts’ clearing accounts and did not affect any other accounts in the treasury pool. The investigators have also confirmed that providing aggregate amounts will not compromise the criminal investigation.
According to officials, the recovery phase is in full swing and they have already recovered over 60% of the funds taken as a result of the fraud. Recovery efforts are ongoing.
Determining the extent of the fraudulent activity has required close cooperation with the Kern Community College District, the Kern County Superintendent of Schools, and Wells Fargo, and they now know the amounts that were taken from the schools’ accounts.
The final tally of fraudulent activity in the Kern Community College District clearing account is approximately $16.4 million, of which the county has already recovered approximately $10.4 million. The final tally of fraudulent activity in the Kern County Superintendent of Schools clearing accounts is approximately $2.6 million, of which have already recovered approximately $1.6 million. The Treasurer said they are aggressively going after every penny associated with the fraudulent transactions and have insured that stringent fraud protection measures are in place.
As soon as the fraud was discovered, immediate action was taken to secure the accounts from any additional fraudulent activity. As a proactive measure, the Kern County Treasury Department has reached out to every district and department with bank accounts in our treasury to review with them their current bank account set up and discuss various fraud prevention options they should consider. The Treasurer wants to assure the public that they are doing everything in their power to ensure that all accounts are protected from the potential for additional fraudulent activity.
"As a public official, transparency is critical to maintaining the public’s trust. I ask for patience from the public as we continue to work through all of the information and details that may be forthcoming from the independent investigation, Jordan Kaufman, Kern County Treasurer-Tax Collector" said.