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Arndt said by approving Resolution 2009-10, the city had completed 91 percent of the recommendations from the 2007 audit.
"Going from zero to 91 percent in a few months is a big move," he said.
The resolution established the fraud detection program and created a finance audit committee to provide independent oversight of the city's financial records.
The independent committee will be comprised of three city residents with business and/or accounting experience.
The volunteer group would meet twice a year to review any financial data from the city.
As part of the plan, Arndt will review revenue and expense plans at least twice a month.
Arndt also plans to encourage and promote ethics training and education for all city employees.
The five most frequent fraud schemes are:
* Diversion of checks received or checks disbursed;
* Misappropriation of investments or other assets;
* Credit card fraud and identity theft;
* Ghost vendors; and
* Theft of equipment and supplies.
In May of 2007, St. Clair's former municipal court clerk pled guilty to stealing from the city.
According to an affidavit, Pamela Gerilyn Benson appropriated at least $25,000 from the city between April 2003 and February 2006.
The 2005 city audit, prepared by Hochschild, Bloom and Company, revealed $34,328.57 in unlocated funds.
The firm came to that number by going through all transactions in the city's court fines account from Jan. 4, 2005, through Jan. 4, 2006.
At the end of that accounting period, the bank account held $20,414.24. The audit found the account should have contained $54,742.81.
Benson was the city's court clerk from 1995 until early 2006.
According to Arndt, the city will enact the following fraud prevention procedures:
* Bank checks shall be kept in a secure location at all times;
* Authorized check signatories shall be limited to the city collector and mayor;
* Check signatories shall not be permitted to utilize a signature stamp;
* City credit cards shall be limited in number and provided to the mayor, city administrator, public works director and chief of police.
Every transaction on the credit card shall be promptly reported to the city clerk with a receipt;
* Lock boxes will be used for the deposit of receivables. Said boxes shall be secured in the city vault overnight and during the weekend;
* Deposits will be made on a daily basis during the scheduled work week;
* References will be checked and verified for all employees and new hires;
* Every employee will be required to take their full vacation, as dictated by the personnel policy, throughout the year; and
* Department heads will follow the capital asset policy concerning the inventory of capital assets and they must monitor the use of smaller items in their departments.
The measure was approved unanimously.
