Auditor: Money stolen from school paid for electronics, music, gas

Jamie May spent money stolen from the Cedar Rapids Community School District on everything from electronics and appliances to music and gasoline, according to a report from the State Auditor's Office.

May embezzled $587,784 from the district between 2002 and 2009, according to the report. Her first-degree theft case was dismissed when she died on Nov. 1, 2009, at age 42. May, who had been fighting breast cancer, died from cardiac arrhythmia.

A 14-page police report obtained by The Gazette on Wednesday provided more details about the case. Detective John Mattias wrote that bank employees at Farmers State Bank became suspicious of frequent cash deposits May had been making and had been monitoring her cash transactions.

Cash deposits into May's account in 2008 and 2009 totaled $237,392, according to the police report. A bank employee told police it appeared all of the money had been spent at “various retailers throughout the Cedar Rapids area including Best Buy,” according to the police report.

Four days later, when Mattias met with May at her condominium on Rockford Road SW, he noted seeing “newer leather furniture in the living room, along with a nice 42-inch flat screen television set mounted to the wall. In the dining room appeared to be a nice wood dining room table and chair set.”

According to the audit, it appears May went on a spending spree with the school's money between July 1, 2008 and Aug. 24, 2009. Some of the largest expenditures uncovered were for appliances and electronics. She spent more than $12,000 at Best Buy from November 2008 to April 2009, as well as $4,427.62 at Home Appliance and $3,451.17 at Slumberland, according to the audit.

May also routinely made purchases at local businesses such as Hy-Vee, Walmart, Target and JCPenney, the audit said. The stolen money paid for dinners at local restaurants and for iTunes music files.

The police report states that May had an account with her then-husband at Linn Area Credit Union until November 2005. A credit union employee told police that the Mays filed for Chapter 7 bankruptcy in June 2003.

May was able to disguise bank withdrawals from the District's account as “change requests,” the auditor's report said. Change requests are used when cash is needed to make change at district events, such as a school bake sale. She replaced the money she took by depositing payments for student registration, transportation and other fees into the district's account without recording the payments.

District records showed certain fee accounts consistently came in under budget, but the matter was never investigated. Instead, school officials trimmed the following year's budget, according to the auditor's report.

“Clearly, there was a weakness in internal controls,” said Steve Graham, the district's executive director of business services.

During a news conference Friday, school officials said May never told them how she spent the money. Graham said the district will attain the highest level of checks and balances possible to prevent another case like this.

“I'm satisfied we are moving in the right direction,” school Superintendent Dave Benson said.