Breaking: Sheriff has strong words on big scam

LaFarr: Treasurer did not have guardrails in place

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Warren County Sheriff Jim LaFarr gave the county board of supervisors a terse, hard-hitting update Friday morning on the investigation into the recent scam that robbed the county of more than $2 million.

He asked the county treasurer, Christine Norton, who was also present, to cease making comments about the case.

“Miss Norton, some of the information you’re sending is alarming to the public,” he said. “Please stop.”

“If at the end, you want to take credit for money that’s recovered … go ahead,” he said, “In the meantime, please stop.”

He also asked supervisors to be more discreet and implored them “in the interests of our taxpayers,” to work together.

He will answer press inquiries himself, he said, and they should direct reporters to him.

The scam netted $2.1 million, sent via a wire transfer on Dec. 12. A second transfer of $1.2 million on Dec. 22 was halted in time to be recovered.

The money was sent as a vendor payment through a system called automated clearing house recently adopted by the county. The scam involved telephone calls and emails from people posing as employees of Peckham Materials Corp., who convinced workers in the treasurer’s office to send the payments via wire transfers, instead of checks, to account numbers they provided.

“This was not a sophisticated cyber attack,” LaFarr said, describing what happened as “human error” and seeming to place the blame on the treasurer and her department.

“Warren County dropped the ball,” he said.

Sheriff Jim LaFarr at a recent event hosted by the Lake George Chamber of Commerce.

The treasurer’s office failed to have procedures and guidelines in place before using the automated clearing house system, he said.

The Dec. 12 payment was made by the treasurer’s office before the county adopted its policy on those sorts of payments on Dec. 19.

The scam began with an unknown person calling the treasurer’s office, engaging several members of the staff in conversation about how the automated clearing house payments worked, he said.

That person had a thick foreign accent, he said.

“A simple call to Peckham, a known vendor we have dealt with for years, would have stopped that from happening, would have never occurred,” he said, referring to the loss of millions of dollars.

Fraud alerts were sent out in late July by Peckham to various vendors, including Warren County and towns in the county, including Queensbury. The county’s deputy treasurer, Monica Stark, worked for the town of Queensbury at the time those alerts were sent, then went in the first week of August to work for the county.

But LaFarr downplayed the importance of those alerts, saying the scam should have been recognized and prevented, whether the treasurer’s office was aware of the alerts or not.

“I don’t need a basic alert to tell me to do my job. If they need this type of alert to do their job, I think you should question their experience and competence,” he said to the supervisors.

He deplored the damage to Peckham’s reputation.

“Peckham Corp had nothing at all to do with this crime,” he said.

He also scolded Norton for sending a letter to one of his investigators on the case.

The letter said, “the involvement of the sheriff’s department … is not an investigation in which we have confidence,” he said.

“Please stop,” he said to Norton a third time.

Christine Norton, Warren County treasurer, is seen here in a photo from her Facebook page.

Norton made a quick statement after LaFarr finished, saying she would like nothing more than a collaborative investigation, but the sheriff’s office isn’t running one.

“I do not think the sheriff is objective,” she said.

“There’s more here than you are being led to believe,” she said, and she called for the supervisors to wait for an investigation by the state comptroller’s office before taking any action.