Audit: San Jon victimized by email scam

A recently completed audit for the Village of San Jon revealed the village was the victim of the email scam that almost cost it over $31,000.

According to the fiscal-year 2024 audit report by Scott Northam CPA, a deputy village clerk fell victim to a fraudulent email regarding a vendor payment of capital outlay funds for a park-improvement project, resulting in a temporary loss of $31,508 in September 2023.

“The Village was alerted of the fraud when the vendor called and inquired about the payment being thirty days late,” the report stated.

Village Clerk Cynthia Lee said it was the first time such fraud had happened at the village.

“We were in disbelief at first,” she said in a recent phone interview.

The village then informed the New Mexico Office of the State Auditor, New Mexico Municipal League, the state Department of Finance Administration and New Mexico Bank & Trust. It also contacted the Quay County Sheriff’s Office and filed a police report.

The audit recommended using two-factor authentication during automated clearing house transfers.

“Because this was a new vendor involved with the Park Improvement Project, the Deputy Clerk/Treasurer took the email at face value rather than verify the ACH information with the vendor,” the report stated.

The village recovered all but $7 from the bank in February 2024.

“Thank God,” Lee said. “There were other communities that weren’t able to recover the funds” from such fraud.

Lee said the village no longer uses ACH for payments and mails paper checks instead.

The fraud was cited in the audit report as a significant deficiency in accounts payable for the village.

The fraud incident was among one of only two findings listed in the audit.

Quay County Sheriff Dennis Garcia said no arrests were made regarding the fraud, nor did his office track down from where the illicit email originated.