OGDENSBURG — A general lack of oversight and leadership contributed to the mismanagement of selling and accounting for tickets to several Ogdensburg Free Academy student council-sponsored events, including a World Wrestling Entertainment show, a district audit reveals.
The 147-page audit, released by the Ogdensburg City School District earlier this week, shows that regulations and safeguards were ignored. The uncensored report also alleges that an off-the-books "cash pool" was created from money collected from events that wasn't deposited.
The audit reviewed six council-sponsored events, with five events that lost or couldn't account for $15,317, including $6,080 in ticket sales for a June 2006 WWE event. The district released the audit 17 months after its completion by the Ogdensburg firm of Hooper & Van House, certified public accountants.
The audit sparked a state police investigation into possible fraud involving the use of money in the OFA student council's extra-classroom activities fund that led to the indictment of a school employee.
Kresten F. Ericksen, who was then the director of the Edgar A. Newell II Golden Dome and student council adviser, and a former city councilor, was arrested in September 2007 on a felony forgery charge. He was accused of forging a receipt for $8,000 in OFA student council funds.
Mr. Ericksen pleaded guilty Monday in St. Lawrence County Court to a reduced misdemeanor forgery charge. He will be sentenced June 30.
"It's long overdue and I'm glad its over," Board of Education President John J. Wilson said of a resolution to the case. "It's a situation that shouldn't have ever happened. We have put in safeguards and rules now to make sure this doesn't happen again."
The district became aware of problems in October 2006 when the student council treasurer informed Superintendent Maurice H. Barry that no deposits were made following the second WWE event in June 2006.
Deposits from the first WWE event were made "promptly" after the event, but several months had elapsed after the second WWE event and no deposits were made. The audit concluded that $6,080 in proceeds from ticket sales for the second WWE show were unaccounted for but untraceable because of poor bookkeeping.
"Prudent, common sense financial oversight of this event was extremely lacking," the report states.
The events reviewed include two WWE shows, a Clarkson University versus SUNY Oswego club hockey game (Feb. 24, 2006), an Ultimate Submission Wrestling show (March 12, 2006), Harlem Wizards basketball game (April 5, 2006) and New York City Total Soul Motown Tribute show (June 17, 2006).
The audit found the hockey game lost $170 to pay for two referees, the Ultimate Submission Wrestling show lost $41 and the Harlem Wizards basketball game lost $3,800. The Total Soul event lost $2,500 because the show never happened, and the June 2006 WWE show had $2,726 in lost merchandise sales and $6,080 in unaccounted-for ticket revenue.
A review of WWE's visit in January 2006 found a profit of $11,672 and no financial discrepancies, the audit stated.
The auditors theorized that money from the college hockey game and Ultimate Submission Wrestling show was collected from the events, but never deposited.
"This gives rise to the likely existence of a cash pool, off the books," the audit states. "Certainly by the time that at least $3,100 is collected from the Harlem Wizards show and not deposited, we can surmise that the cash pool exists."
The audit also revealed that several events didn't have an accurate ticket count, and contained a 28-page transcript of an interview done Dec. 21, 2006, with Mr. Ericksen.
Several district officials, the school attorney and the auditor were present during the interview. The interview covered, in detail, how each event was organized and how the money was collected and tickets were distributed.
As part of the plea agreement, Mr. Ericksen agreed to reimburse the school district $15,335 and resign from his position. The reimbursement covers the $12,235 the district spent for an audit of student council finances. He also agreed to reimburse the district $3,100, which he said represents the proceeds of the second of two Harlem Wizards events at the dome that were never deposited in the bank and which are unaccounted for because of sloppy bookkeeping.
Mr. Wilson said he hopes the Golden Dome can be used again as it was for the two WWE events, while helping fundraising efforts for student activities.
