Last week brought the latest developments in the ongoing scandal in southern Arizona.

Liz Gutfahr is the former treasurer of Santa Cruz County, about 110 miles south of Tucson along the border with Nogales.

Last Thursday, Gutfahr pleaded guilty to stealing more than $38.7 million in public funds and waived his right to a trial.

Daisy Zavala Magaña is a reporter for Nogales International who has been covering the twists and turns of this rather extraordinary story.. She joined the show to sort out the sordid details.

conversation highlights

How long has Liz Gutfahr served as Treasurer and what exactly are her responsibilities?

Daisy Zavala Magaña: Yeah. In other words, she served as Treasurer for just over 10 years. From January 2013 to April 2024. And overall, as you might expect, she was responsible for managing and distributing public funds. As such, her duties included overseeing the county’s bank accounts. That means checking your savings and investment accounts. She also handled procedures such as property taxes and coordination to ensure all county funds were accounted for.

Let’s talk about the basics. In her position, she oversees all of that. How could she steal all this money?

Zavala Magaña: Well, I know we’ve been in the dark for a long time, but thankfully a review of court documents has shed some light on this issue. It turned out that she had falsified her bank statements. She falsified the cash reconciliation report. And she also circumvented the verification process.

For example, she asked the Deputy Chief Treasurer to give her a password to bypass it. [two-factor athentication] …It takes two people to approve things. And she was also well aware that the auditor general’s practice is to only review the county’s bank step report each June. …so she was more than ready… when the time came.

And just recently, federal authorities shared that she had made 187 fraudulent transactions, which was brought up during her guilty plea hearing. … So she took county money and transferred it to two personal business accounts, making it appear as if they were official county transactions. That’s how she went 10 years without raising any red flags.

Therefore, it appears that these personal accounts, these companies, to which Gutfahr transferred funds were not formally incorporated. correct?

Zavala Magaña: Yes, that’s right. The above is Rio Rico Real Estate and Rio Rico Consulting. That is, they were not actually registered as a business.

So what did Mr. Gutfahr do with this money during the last decade or so of fraud?

Zavala Magaña: Yes, it’s a long list. … So far, we know that she has purchased multiple cars, luxury items, and personal items. She used stolen county funds to purchase cattle and various real estate properties, including the Rancho San Cayetano property…which is an equestrian facility. The county also filed a civil suit to impose receivership and thereby foreclose on 17 properties. It was also discovered that her son and daughter-in-law had actually spent at least $2.2 million on county funds and luxury goods since 2018. Rolexes, luxury handbags, racehorses, and vacations. In other words, a long list of ways to enrich yourself.

As you just alluded to, this story seems like this was a bit of a family issue, this ongoing scam.

Zavala Magaña: Well, that’s what the civil lawsuit shows. … The county’s attorney basically said that her husband, son, and daughter-in-law knew about and benefited from her plan to deceive the public and were in some ways complicit in it. There is. of Santa Cruz County.

Are they also facing legal issues?

Zavala Magana: They have been named as defendants in the civil suit. All three of them: her husband, son and daughter-in-law. However, as for the criminal charges, he is not listed as a defendant at this time, and it is unclear whether he will be listed as a defendant.

How did she finally get caught?

Zavala Magaña: Yeah. That’s a good question. So the real trigger for it all was on April 3, when JPMorgan tracking detected so-called irregular activity in the county’s bank account. So when they discovered it on April 3rd, they alerted the deputy county chief, which started an investigation that revealed everything we know today and led to a civil lawsuit. And just recently, some of the federal employees to whom Mr. Gutfahr pleaded guilty faced criminal charges.

Gutfahr hasn’t denied anything about this, but what will happen to her in the future?

Zavala Magaña: Yeah. That means she will be sentenced on February 6th, and then we’ll know how much she’s willing to pay, including $38.7 million in restitution as part of her plea agreement. Includes $13 million in taxes. So I think we’ll see where they are during her sentencing.