Louisville Metro Councilman Kelly Downard says the city should seek to tighten regulations on city contracts to reduce the potential for fraud.
A recent internal audit and police investigation found that personnel in the city’s shuttered Department of Neighborhoods fabricated dozens of invoices worth more than $368,000.
The reports allege that Melissa Mershon, who led the department under former Mayor Jerry Abramson, deceived city officials about agreements with third-party contractors to pay for popular events that allowed them to be concealed from the Metro Council’s oversight.
Downard says that is unacceptable.
“Melissa Mershon would have been maybe the last person I would’ve thought did that. So it scares me that maybe it was pretty widespread. I think falsifying invoices even if you do it for the right intention is still falsifying invoices. I don’t know how to get around that,” he says
At a recent committee meeting, however, the city auditor told council members that no bookkeeping policy could have caught the problem because of collusion between several employees, but Downard believes that can change.
“I think we can certainly tighten up internal control because there was none. It would be easy to make it tighter. I believe that the new administration will work very hard—they already are—cooperatively to try to arrange a proper set of internal controls that will reduce any ability to do these things.”
Mershon resigned last year when a state audit revealed she had violated the city’s purchasing rules after questions were raised about her role in producing a book about the history of Louisville’s neighborhoods.
Abramson eliminated the department due to unrelated budget cuts and folded into the Parks Department last year.
The Jefferson County Commonwealth Attorney’s Office declined to pursue criminal charges against Mershon.