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Jayme Valenzuela
Recalled Mayor allegedly used town card when his own debit card was underfunded or overdrawn
When it was first revealed in December 2015 that Jayme Valenzuela, then Mayor of Superior, had made withdrawals for personal use from the town debit card, Valenzuela admitted he did so and said he had made a mistake and that his use of the debit card was accidental.
However, a report on the investigation into the alleged fraud made by the Special Investigation Section (SIS) of the Arizona Attorney General’s Office secured recently by the Superior Sun indicates this might not be the case. Evidence collected during the investigation alleges that the town debit card was used because it was handy when there were insufficient funds in the debit card attached to Valenzuela’s personal banking accounts. It also revealed that inadequate record keeping practices by Superior Town Hall management led to the misuse of the debit card not being discovered until nearly 2.5 years after the first misuse occurred.
Evidence collected by SIS resulted in a State Grand Jury issuing an indictment on July 8 charging Valenzuela with one count of theft, a class 5 felony that carries a maximum penalty of 2.5 years in jail upon conviction. The trial on these charges is scheduled to begin on Sept. 20 in Arizona Superior Court at 175 W. Madison, Phoenix.
SIS launched its investigation last Feb. 8 when it seized records at Superior Town Hall. These included recordings of the Dec. 9, 2015 Town Council meeting during which then Town Clerk Rachelle Sanchez revealed the existence of four undocumented withdrawals of funds made at ATMs from the town debit card at Valenzuela’s disposal. Valenzuela admitted making the withdrawals, but then cast the deciding vote to terminate Sanchez as Town Clerk.
Also seized was a report by the auditing firm of Colby & Powell LLC that uncovered eight ATM cash withdrawals made from the town debit card held by Valenzuela between Aug. 12, 2013 and Dec. 31, 2014 that totaled $2,345.40 including ATM fees. To repay these withdrawals, Valenzuela issued a cashier check from the Wells Fargo Bank for $2,323 on Dec. 16, 2015, and a Wells Fargo money order for an additional $22.25 on Jan. 10, 2016.
Early in the investigation, SIS was found lax procedures in financial matters.
Margaret Gaston, then Superior Town Manager, said the procedure was for debit cards issued in the names of the mayor and town manager were to be kept in Town Hall offices and checked out as needed and checked back in with a receipt for what it was used to buy. However, Valenzuela kept his town card and carried it with him all the time.
Gaston, who told SIS she was responsible for tracking town expenditures, admitted that due to employee turnover and inadequate staffing, bank accounts were not checked against expenditure statements in a timely manner. One staffer ordered to assist with accounts payable said the lack of receipts hindered her assigning billing codes to invoices, and was told by Gaston to code two Valenzuela withdrawals as for being meals.
These lax procedures contributed to Valenzuela’s personal withdrawals not being discovered sooner and probably contributed to the problem becoming bigger, SIS found.
SIS later subpoenaed Valenzuela’s bank records. During the period when the personal withdrawals were made from the town debit card, Valenzuela had a personal debit card attached to his bank account with the Pinal County Federal Credit Union (PCFCU), where his salary with the Pinal County Sheriff’s Office (PCSO) was automatically deposited.
The investigation alleged that Valenzuela had a reason to use the Superior debit card instead of his PCFCU debit card as at the time all eight withdrawals from the Superior card the PCFCU card either had insufficient funds to cover the intended withdrawal or was overdrawn.
“The (PCFUC) account statements reflected Valenzuela had approximately $300 in overdraft fees for 2013 and approximately $240 in overdraft fees in 2014. The account statements also reflected on multiple occasions Valenzuela had account balances under $100 in 2013 and 2014,” the report said.
As to why Valenzuela’s account would be perpetually low on funds was hinted by SIS, which found numerous withdrawals at casinos in Arizona and Las Vegas between August 2013 and December 2014. In May 2014 alone, Valenzuela made $2,400 in withdrawals at casinos. Besides the Wild Horse Pass Casino, he also patronized the Gila River Casino, Apache Gold Casino, Casino Del Sol, Casino Arizona, Mazatzal Casino, Harrah’s Ak-Chin Casino and Harrah’s Las Vegas.
In his defense, Valenzuela said he mistook the Superior debit card issued by The Bank of the West with his PCFCU debit card because they looked alike and had the same PIN numbers. However, the SIS investigation indicated this couldn’t be possible as the debit cards had different designs and color schemes. The Bank of the West card depicted a bear with two cubs with the bank name in bold white letters above the bears while PCFCU card depicted a cactus with the bank name below.
Copies of both cards were shown to the Grand Jury, which subsequently indicted Valenzuela on July 8.
Only days before December 9 Town Council meeting where former Town Clerk Sanchez made the debit card misuse public, Valenzuela moved his banking and saving accounts from PCFCU to the Wells Fargo Bank.
Even before going to trial, Valenzuela has paid a penalty for his admitted use of the Superior debit card. In July, PCSO terminated Valenzuela from his job as a commander in charge of contracts and supplies with the Pinal County Detention Center in Casa Grande. And on Aug. 30, voters in Superior removed him as Mayor in a recall election.
The Superior Sun contacted persons mentioned in the SIS report for comment but as of this writing have received no reply. A person is considered innocent until proven guilty in a court of law.
The SIS investigation report was secured under a Freedom of Information request filed with the Arizona Attorney General’s Office.
James J. Hodl is a career journalist who has worked for newspapers, magazines and trade journals. A graduate of Southern Illinois University with a Bachelor of Science degree in Journalism, Hodl began his career as a reporter with the Palatine (IL) Herald and the Morton Grove (IL) Review before becoming editor of the trade publication Appliance Service News. In recent years, Hodl has had articles published in Consumers Digest, Good Housekeeping, Home Remodeling, Kitchens & Baths and Salute; and has contributed to trade publications serving the home furnishings, restaurant and casino markets. A native of Chicago, Hodl relocated to San Tan Valley in 2013.
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