2013-01-17 / Front Page

Big Bay embezzlement issue ends

3 years after manager takes funds, settlement reached


The entrance to Big Bay de Noc School is shown above. The district recently reached a settlement following a 3-year-old embezzlement. 
Pioneer Tribune photo The entrance to Big Bay de Noc School is shown above. The district recently reached a settlement following a 3-year-old embezzlement. Pioneer Tribune photo GARDEN – Three years after an embezzlement scandal rocked the Big Bay de Noc School District, a settlement has been reached. Details of the settlement, which amounts to only a fraction of the over $800,000 allegedly taken by a former business manager, were released Tuesday.

According to a statement issued by Superintendent William Pistulka, the Big Bay De Noc School District Board of Education worked over the last 36 months to correct the issues which arose after the embezzlement was uncovered.

“Claims against various entities (insurers) for losses the district incurred as a result of the embezzlement have been resolved to be: Insurers have paid the district in settlement of those claims,” he explained. “The district has incurred legal costs and fees from the settlement amount which have already been paid by the district.”

The actual net revenue the district intends to collect from the settlement, Pistulka added, is $217,910.11.

Details of the embezzlement by the district’s former business manager first came to light in February of 2010. At that time, it was revealed that the Michigan State Police, along with the district, had been investigating the theft of funds since an unintentional discovery on Jan. 12 uncovered unauthorized checks issued to the former manager.

Following this discovery, more evidence mounted against the manager, and the person was immediately terminated. Eventually, the school determined, through financial statements and electronic records dating back to 2002, that the then-manager had embezzled over $100,000 per year. The district’s superintendent at the time, John Peterson, explained that the over $800,000 could have amounted to even more, but that the district was limited in the amount of information they could retrieve from past records. The business manager had been employed with the district for 18 years.

Despite the mounting evidence in the case, the former business manager died on Jan. 25, just weeks after a full investigation was launched. In April of 2010, the MSP announced the case would be closed and a name would not be release because of the suspect’s death.

Peterson had said the district would work with the Delta-Schoolcraft Intermediate School District, as well as the Manistique Area School District, to sift through the district’s accounts and “move forward with accurate information”.

The Big Bay de Noc School District currently shares MAS Administrative Assistant Donna Winkel, who serves as their finance director.

In Pistulka’s statement Tuesday, he noted that, pursuant to an order issued by the Delta County Circuit Court, the district’s board is limited to releasing only limited information about the settlement, and would not be commenting further on the proceedings.

“The Big Bay de Noc Board of Education looks forward to the conclusion of this very unfortunate situation,” he said. “They are prepared to move forward with a positive and educationally productive future for the students of the school district.”

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