The Crested Butte News Serving the Gunnison Valley since 1999
Intent was to handle some “outstanding projects”
Some questionable actions in early January have led the outgoing Gunnison-Crested Butte Tourism Association (TA) board of directors to request an audit of the organization’s financial books from the last year.
According to TA interim executive director John Norton, previous director Pamela Loughman placed a $50,000 advertising insertion order on January 5 with the Denver Post. She was not employed by the TA at that time. Loughman had submitted a letter of resignation to the board in early December. Her contract officially ended December 31, 2014. Norton started work with the TA December 15.
Norton said Loughman had also approached MediaSpade, an email marketing firm, on January 6 and informed them that if they wanted more TA business, they should act quickly since a new director was coming on board and she would discuss contracting for the first quarter of 2015. They declined.
In what could be a more serious breach, it was discovered that Loughman apparently accessed the TA QuickBooks program twice in early January from what appears to have been her remote computer. Norton said it hasn’t been determined what, if anything, she did while in the organization’s accounting program but Norton characterized the incidents as “break-ins.”
The transgressions were discovered this month by the TA’s interactive marketing manager, Laurel Runcie.
“Obviously we are concerned with these actions. We found out last week that Pamela Loughman had signed a $50,000 insertion order with the Denver Post on January 5, after she had left the organization,” Norton explained. “We are told by another vendor that she tried unsuccessfully to make another ad buy so that the vendor would not have to deal with the new Tourism Association. She also appears to have broken into the accounting system the morning of January 5 and between 11 p.m. and midnight on January 8. On top of that, board officer Scott Clarkson had to make a number of calls to her in January ordering her to return the TA’s personal computer. A couple of these on their own might trigger an audit. Taken together, an audit is the only responsible course of action for the TA and the county to take.”
At the TA board meeting Tuesday morning, board member Jeff Moffett said he supported an audit of the last year, given the circumstances.
If more suspicious activity is uncovered, he said, the audit should be expanded to include previous years. The board agreed.
Contacted by the Crested Butte News Tuesday, Loughman responded in an email that she was just finishing up loose ends.
“There were a few outstanding projects at the end of the year which I mentioned to the then–TA president that I would handle as a courtesy,” Loughman wrote. “They included processing invoices (via QuickBooks) for the incoming executive review/signature, shipping tradeshow materials to Chicago, and keeping executive files on the laptop for the benefit of the incoming director. As the saying goes, if you give people the opportunity to do the right thing you’ll rarely be disappointed. And that was my intent. The TA board of directors would have better served the community by conducting an exit interview prior to my departure.”
Norton said he wouldn’t have thought to prioritize contact with vendors when he first started at the TA and that could be a reason Loughman was able to sign a contract with the Post. “I suppose the Post didn’t know of the transition and so thought this was business as usual. And I didn’t think my first order of business at the TA was to alert vendors that Pamela was no longer with the organization,” he said. “This was a pretty fluid several weeks at the TA. Rebecca Filice, the one remaining employee, had a baby on the 6th. Laurel Runcie, who had resigned in the fall, had not yet returned to help us. Jim McDonald, board chair, had just quit. I was still trying to find the key to the front door and the way to pick up phone messages.”
When Runcie did return to work, her first task was to start working on the budget for the March airline promotions. “Pamela and I had a conversation before Christmas to discuss what monies had been committed by the TA for the first quarter. I told her we would be using the unallocated funds to support the Gunnison Getaway and the RTA airline promotion to fill seats in March,” Norton said. “Laurel called the contact at MediaSpade and [the company rep] mentioned that she had been speaking with Pamela as recently as January 6 about contracting for Q1,” Norton said.
“This triggered the email from Scott [Clarkson] on the afternoon on January 8 to Pamela requesting that she stop communicating with vendors and immediately return the computer,” continued Norton. “This week, we received an invoice from the Denver Post in excess of the budgeted amount for 2014, at which point Laurel went digging for the contract and found the insertion order that had been digitally signed on January 5. I’m not yet sure of the TA’s obligation for contracts [Loughman] signed when she was not authorized. “
As for the remote access to QuickBooks, there is no definitive action seen beyond that Loughman logged in. “We expect that a specialized audit will help us find out,” said Norton. “Laurel is very good at this stuff but she’s not a forensic accountant. I’ve never even used QuickBooks and so not much help.”
As for trying to unwind the details, Norton said Loughman has not been particularly helpful. “She left no contact information with any of the board or any of us on staff. On December 17 she made the point plainly she would help with the transition but that after December 31 she would no longer be available for anything. Scott called her a couple of times on February 7 at a number answered by her voice on a recording,” said Norton.
Norton told the board Tuesday that Loughman returned a call to Clarkson this week and said, “none of the things she was accused of doing had happened.” Norton was very skeptical of that response and when asked by board member Kay Peterson if the QuickBooks program could have been hacked, Norton said it was very unlikely. The breach had come from Loughman’s TA computer before it was returned. He also reported that the Denver Post confirmed they dealt with Loughman on the $50,000 ad insertion.
Gunnison County’s auditing firm that also audits the RTA and Housing Authority, McMahan and Associates, will perform the investigation. There are no obvious kickbacks seen to Loughman. Norton said Loughman did return the computer to the TA but had uninstalled the computer’s browser.
Norton said local law enforcement agencies have not been put in the loop but noted, “We’ve kept county deputy attorney Art Tresize and County Commissioner chair Paula Swenson in the loop from the moment this surfaced. There is absolutely nothing we know that hasn’t been shared with both of them. They have been copied on 100 percent of our board correspondence that relates to this. We requested the county re-key the office building. That will be an inconvenience to our office neighbors but it’s the prudent thing to do.”
Given that the annual discretionary TA budget is approximately $1 million, the Denver Post order is five percent of the budget. The financial audit will be paid for out of the Local Marketing District reserve fund.
