Metropolis: Wednesday, March 15, 2006
Payroll Deduction

City workers are angry that a labor group didn’t watch their money better.


Six years ago, Dwain Phillip Beaty was convicted in Tarrant County of theft of property by check. He was jailed for a day and ordered to pay court costs. By 2001, Beaty was in trouble again, for theft of service. He pleaded guilty, spent another day in jail, and paid a fine. Both offenses were class B misdemeanors for thefts between $20 and $500, according to Tarrant County records.

This year Beaty faces another allegation of theft, but the stakes have risen considerably.

The 19-year employee of the City of Fort Worth was recently accused by officers of the General Employees City of Fort Worth association of embezzling $59,000 from the group’s bank account. GE is a 650-member nonprofit labor organization where Beaty has served as treasurer since 2004.

The case is under investigation by Fort Worth police, GE vice president Bill Matysek said. He said Beaty told him in January that he had taken the association’s money over a two-year period. A supervisor in the payroll department, who asked not to be named, said he and two other supervisors were also told by Beaty that he had taken the money. Reached at his home, Beaty, 42, referred questions to his attorney Danny Burns, who has not returned phone calls.

The association job wasn’t the only one in which Beaty had access to someone else’s money. Until he resigned last month, he was a senior accounting clerk in the city’s payroll department, communications director Eileen Houston-Stewart said. Costa Triantaphilides, head of the city’s auditing department, said an audit of Beaty’s work for the city over the past few years has begun, but the report won’t be ready until the end of the month. Triantaphilides found out about the theft convictions, he said, after he began the audit.

When asked how someone with that record was allowed to work in a city department where he had access to millions of dollars, Houston-Stewart said the city does not do criminal background checks on employees after they are on board, but only on new hires. With more than 6,500 workers, she said, such an effort would be cost-prohibitive.

General Employee members also apparently elected Beaty as treasurer with no knowledge of his past convictions. According to Matysek, all but $45 of the group’s funds have been wiped out by withdrawals via a debit card issued to Beaty when he took over the treasurer’s job in late 2004. Matysek, a senior building construction manager, and GE president Bruce Simon, a superintendent in transportation and public works who is also vice-chairman of the city’s retirement board that oversees $1.62 billion in employee funds, were the only other members who had debit cards, Matysek said. “In hindsight, [giving out debit cards to anyone] wasn’t a good idea.”

“It was a terrible idea,” said retired librarian Carol Eicher, who helped found the group in 2001 and served on its board until 2004. The group’s purpose, she said, was to “have a presence at city hall” in order to lobby for better benefits for its members.

Matysek and Simon “have failed us miserably in their fiduciary duties,” she said. Eicher and the group’s first treasurer, Sue Winter, also a retired librarian, vetoed the use of debit cards when Winter controlled the account. “Too easy to be abused,” Winter said.

However, their decision was reversed when Simon took over as president. Eicher said that in 2004 control of the group became concentrated in the hands of Simon, Matysek, and Beaty and that the rest of the board was cut out of the decision-making process. She and member Kevin Hansen, chief land surveyor in the city engineering department, along with a current board member who asked not to be identified, said the group’s bylaws were consistently ignored after Simon became president. Eicher and Hansen said that, despite bylaws requirements, a 2005 audit of the group’s books was not done, no membership meeting was called that year, executive board meetings have not been held as required, and mandatory annual financial reports have not been provided in two years. The board member said that she has not been notified of a board meeting in over a year.

But the issue that’s become the smelliest for Eicher and Hansen is that, in spite of the association’s bylaws that clearly state its financial records “shall be open for inspection by any member of the Association,” their requests since June for such access have been denied. And the problem goes beyond bylaws: Under federal law covering tax-exempt groups, nonprofits such as GE are required to make their tax returns and supporting financial documents available for inspection by any member of the public. Still, when Fort Worth Weekly asked to see the books, Simon said they had all been turned over to the police and were not available. He declined to comment on the records, the allegations of broken bylaws, or the missing money, citing the police investigation as his reason.

A few angry GE members are bringing their fight into the open, pushing for answers with little success so far. A general meeting has been set by Simon for March 17, Matysek said, to explain what happened and ask for help in restructuring the group. The labor group’s officers are likely to face some hot questioning, including how so much money could have gone missing without either Simon or Matysek catching it.

The organization’s dues are modest — a dollar per biweekly pay period, deducted by the city payroll department, Eicher said, set so that even the lowest-paid employees could join and have their interests represented at city hall. Over five years, with membership fluctuating between 950 and 650, those small dues payments should have generated close to $100,000, Eicher said. For the first three years, she said, the money was used for such things as newsletters, expenses for membership meetings, and recruiting.

In a March 11 letter to City Manager Charles Boswell and to the mayor and city council, Eicher asked that the city stop transferring dues payments into the current GE account until a determination has been made as to “exactly how much was embezzled and by whom.” The city should not continue to put money into an account that has been wiped out by theft when more debit cards are still out there, she told the Weekly. “I am not accusing anyone else of being involved,” she said, “but this investigation is still open, and the members’ dues should now be put into an escrow account to protect the funds.”

Boswell said the city would do that if the GE board made a written request. Until then, he said, “we really can’t do anything. These are private funds.”

Matysek said that no one was more shocked than he when Beaty told him that he had “reduced all of the funds” in the group’s accounts. Beaty told him that, Matysek said, after he and Simon pushed Beaty for a detailed financial report for 2005. He was able to hide the situation for two years, the vice president said, “because of the way our system was set up”: Beaty picked up the bank statements and gave Simon and Matysek a written summary of the accounts. “We never saw the bank statements, only his version of them,” Matysek said. “Everyone was busy with their jobs, and it just seemed easier at the time to have debit cards so that we didn’t have to find each other to sign checks. ... Obviously, there are better ways to do this.”

When asked about his refusal to let Eicher and Hansen see the financial records for the past year, Matysek said he didn’t think their requests were made for legitimate reasons. Therefore, he said he “had the right to refuse” in spite of the by-laws and the IRS code. He declined to elaborate. Maybe he’ll have to on March 17.

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