Politics & Government

Sedgwick County forms group to review financial vulnerability after fraud

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Sedgwick County has formed a working group of county staff to examine its financial risks and vulnerabilities.

And it has already taken some action: removing an electronic document that vendors use to request payment from the county’s website.

The Vulnerabilities Working Group is tasked with performing “an overall review of securing financial data,” according to Kate Flavin, Sedgwick County’s public information officer. She said the group formed during the last week of December.

That was about two months after Sedgwick County realized it lost roughly $566,000 to fraud in October. An investigation into the loss continues and involves the FBI.

An electronic payment of $566,088.90 never made it to Wichita construction company Cornejo & Sons for a preventative road maintenance project. The payment was sent after someone posed as a vendor and asked for billing information to be changed, according to a document obtained in a Kansas Open Records Act request.

The county won’t release documents related to the request to change payment information. It’s unclear if those who defrauded the government used an official county form.

Eight other vendors submitted requests to the county during the time frame of The Eagle’s open records request. Seven of those payments were on an official county document that requests bank name, bank location, routing number and bank account number.

That “Authorization for ACH Deposit of Vendor Payment” form is no longer on Sedgwick County’s website. ACH refers to the Automated Clearing House, the electronic network where the fraudulent payment was made.

Flavin said the working group recommended that the county “remove and replace the form.”

“Finance removed the form from the website for financial security purposes,” Flavin said. “They’re finalizing the replacement form for the website for bidders to use in place of that form.”

Finance removed the form from the website for financial security purposes.

Sedgwick County public information officer Kate Flavin

“Vendors can call (the finance department) and work directly with staff to make any changes,” Flavin added in a later e-mail.

Flavin said the working group is made up of county staff from the information technology and finance departments, the county manager’s office and the county counselor’s office.

The county did not acknowledge the internal working group publicly until a reporter with The Eagle asked why the form was off the website.

Sedgwick County’s new auditor, hired in December, is also tasked with examining the county’s vulnerability to fraud.

Daniel Salazar: 316-269-6791, @imdanielsalazar