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Montebello officials find 2nd off-the-books bank account

February 17, 2011 |  9:06 pm

Montebello officials said Thursday night that they have discovered a second off-the-books bank account that once contained nearly $1 million in city funds and now has only $5,000.

Interim City Manager Peter Cosentini told The Times that officials do not know why the account was created, why it was never recorded on the city's general ledger or what happened to the money that was transferred out.

Cosentini said one signator on the account was former City Manager Richard Torres. That is not in keeping with city policy, which generally requires the treasurer to be a signator, not the city manager. The bank refused to disclose to the city who the other two signators are.

The revelations about this account, which was at Union Bank, follow news of another off-the-books account at Banco Popular that officials discovered a few weeks ago. That account contained about $240,000 and officials also discovered records that indicated tens of thousands of dollars had been transferred out. They do not know to whom or why.

The city's official banker is Bank of the West.

"We will get to the bottom of this," Cosentini said.

He said officials have asked for bank statements and records and are hoping to reconstruct what happened. They have also queried every member of the finance department to ask if they know of any other off-the-books accounts.

The Union Bank account came to light when an employee spontaneously alerted the finance director. Officials found out about the Banco Popular account when the bank contacted the city because it had been dormant for a while.

"It is proven that there is money that we cannot account for. Why were these accounts off the books?" City Councilwoman Christina Cortez said, adding that she wants a "forensic audit of everything" in the city.

The news about the accounts comes as Montebello struggles to close a deficit that could force officials to make deep service cuts and lay off employees.


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