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State finds lack of oversight allowed Getzville woman to embezzle nearly $20,000

A lack of oversight and accountability allowed a Getzville executive to pilfer money from trust fund accounts held for children of the Cayuga Nation of Indians, according to a report by the state inspector general.

Kim Thomas-Muffoletto, 57, was able to steal nearly $20,000 from the accounts over seven years without detection, the office found. The thefts were exposed in 2014, when Thomas-Muffoletto was arrested and charged with grand larceny. She pleaded guilty in January 2015 and was sentenced to pay full restitution and spend five years on probation.

Thomas-Muffoletto oversaw the funds while she was director of Native American services for the state Office of Children and Family Services and was the only person with access to the accounts, which were used to distribute money to Cayuga Nation minors in accordance with treaty obligations.

An investigation found that the Office of Children and Family Services “failed to take any reasonable measures to monitor or audit the accounts,” leaving them entirely in the hands of the director, Inspector General Catherine Leahy Scott said.

Through its Native American Services Bureau in Buffalo, the state office was responsible for making payments to Cayuga Nation minors not residing with their parents from funds in 14 trust accounts that Thomas-Muffoletto administered.

Leahy Scott’s investigation revealed that the state office had no internal controls, no audits and no supervision of Thomas-Muffoletto’s management of the trust funds.

As a result of the findings, the inspector general recommended that there be a thorough review of the policies and practices of the Native American Services Bureau and that there be a thorough audit of all funds handled during Thomas-Muffoletto’s tenure.

After exposure of the embezzlement, the state office transferred administration of the accounts to the Cayuga Nation.