A Gila County grand jury has indicted former Payson School District accounting supervisor Phyllis Woods, 62, on 16 felony counts, ranging from fraud to theft.
Woods, who is suspected of stealing at least $161,000 from the district's revolving fund account, will be arraigned at 9 a.m. March 2 in Payson Superior Court before Judge Edd Dawson.
Working on a tip from school officials, Payson Police detectives began investigating Woods last fall.
Investigators, who served a search warrant on Woods' home, found evidence in her personal records that she had allegedly paid personal bills with checks written out of school district accounts, Det. Steve Johnson, of the Payson Police Department, said.
Police believe Woods --a 19-year employee of the school district -- used the district's revolving expenditure account to pay her own bills. They also believe the theft of school funds had been going on for at least three years.
While the investigation continued, Gila County Attorney Jerry DeRose turned the case over to the Arizona Department of Public Safety. DeRose said the Payson Police Department did a good job of investigating the allegations, and turned up a stack of canceled checks with corresponding personal bills that suggested that Woods had been paying her debts with school funds.
"The reason it's gone to DPS is that they have auditing staff that can devote the time and expertise necessary to make sure that we do a thorough investigation," DeRose said.
DeRose said DPS isn't quite through with its accounting, but at this point, auditors have uncovered upwards of $161,000 that was taken from school coffers.
"When you consider the average beginning teacher costs $30,000 a year with benefits, that's equivalent to about five teachers," said District Superintendent Herb Weissenfels.
Since the discovery of the thefts, Weissenfels said the district has tightened up security when it comes to district funds.
"Over in bookkeeping, there have been some changes," he said. "I know they run a lot more internal audits. More people are involved in the approval system with purchase orders and payments and so on. It involves more people, so if there's anything funny looking, it gets caught right away."
Arthur Lloyd, Wood's attorney, said his client denies any wrong-doing.
"She swears she's absolutely innocent," Lloyd said Thursday. "The school district isn't out one thin dime."
A formal complaint was issued early this month, and the grand jury indicted Woods on four counts of fraudulent schemes and artifices, four counts of misuse of public funds, four counts of theft, and four counts of trafficking in stolen property.