Elmhurst D205 Credit Card Inquiry Finished; Irregularities Sparked It

ELMHURST, IL – An audit firm has finished its review of Elmhurst School District 205's credit card spending practices and suggested changes to procedures.

The inquiry was launched after Patch reported that a former official, Todd Schmidt, put nearly $50,000 in personal expenses on his government credit card. He regularly reimbursed the district, essentially getting unofficial short-term loans.

Schmidt resigned in early December. That was a couple of weeks after he was arrested in Rockford on charges of stealing tens of thousands of dollars from his mother.

At Tuesday's school board meeting, board President Athena Arvanitis unveiled her two-page memo on what she said were the findings from the firm, Chicago-based Ostrow Reisin Berk & Abrams.

The district did not release the audit report. Patch filed a public records request for it.

Arvanitis said the district has already carried out many of the audit firm's recommendations. She vaguely referred to the situation involving Schmidt.

"We know that moving forward, there will be a continual review of processes and procedures, identifying areas where we can strengthen and enhance, of course, to mitigate issues like the one we experienced a little bit ago," she told the board.

According to Arvanitis' memo, the auditors recommended that the district review and determine the number of "approvers" and supervisors who review credit card statements.

In Schmidt's case, the district was unable to provide Patch with any documentation on who approved his credit card spending. It has declined to say who it suspects did so.

In February, Chris Whelton, assistant superintendent of finance, resigned in the wake of the controversy. The district then announced it was hiring an auditor to investigate the finance office's practices.

In her memo, Arvanitis said the audit firm also suggested the district store all credit card requests, communications, signed usage agreements and approvals. The district said it has started this practice.

Arvanitis said the district has adjusted credit card spending limits and the number of employees being issued credit cards. She gave no details.

The board also had the firm review the district's bidding process. Schmidt, who was hired as facilities director in 2018, presided over $168 million in building projects that a voter-approved referendum made possible.

The firm, Arvanitis said, found no deviations from the district's process that would suggest a need to audit this area.

Overall, Arvanitis said the firm was pleased with the administration's efforts to "swiftly" carry out improvements to its credit card system and lessen the risk of improper card use.

Public records show that Schmidt used his government credit card for booze, cigars, airfare for himself and family, groceries, restaurant meals, country clubs and a sorority.

In December, in response to a Patch inquiry, Elmhurst police said the outcome of District 205's audit would determine the police's involvement in the case.

Situations similar to Schmidt's in other towns have resulted in "official misconduct" charges.

Editor's note: A previous version of this story stated that Patch had filed a public records request earlier this week for the recent credit card audit. Patch sent it to the wrong email address. It has re-sent it to the district.