La Feria expands search for missing money

LA FERIA — City commissioners last night voted to give their attorney authority to expand his search into finding $3 million in missing money.

Now, attorney Rick Navarro will begin a probe into several nonprofits, including South Texas Collaborative, for Housing Development, which is connected to the city and former city manager Sunny K. Philip.

His task is to look into the buying and selling of property between the nonprofits and the Industrial Development Corporation, or IDC.

The IDC is a nonprofit entity that was organized in 2009. Navarro said that at one time Philip was city manager and also the acting executive director for IDC.

“We have some concerns about the legality of those transactions,” Navarro said after the meeting.

Navarro said Philip was an agent for seven of those nonprofits.

Navarro said any expenditures of money needed to have been brought to the City Commission.

All the nonprofits in question were using City Hall as their official address.

Navarro said this is an ongoing effort to find the $3 million in certificates of obligation for city projects that are unaccounted for.

Navarro told city commissioners that without any further legal action he could not continue his investigation in the missing money.

Navarro said it could not be determined how much land had been purchase and how much money has been spent. He said this is just a starting point in an effort to find the missing money.

Philip filed a lawsuit against the city last July after he was fired, alleging wrongful termination and seeking back pay.

Months later, on Feb. 28, the City Commission voted to take civil action against Philip in an effort to find answers to where $3 million in city project funds went.

The city was looking for a total of $6.4 million in funds linked to certificates of obligation that were for street improvements, drainage and building infrastructure.

However, since then City Manager Jaime Sandoval reported the city’s finances were fine.

City commissioners have been tight-lipped about Philip’s termination and the investigation into the missing money, referring all questions to their legal counsel.

La Feria City Attorney Rick Navarro said the money is unaccounted for and it’s possible it was spent inappropriately.

Navarro, with the Denton Navarro Rocha Hyde and Zech P.C. law firm, led the performance evaluation of Philip that led to the City Commission’s decision to fire Philip.

Philip had held the position of city manager since 1993.

The decision to fire Philip led to the appointment of then City Secretary Esmeralda Sanchez as interim city manager last July.

Nearly two months later, in September, Sanchez handed in her letter of resignation due to the changing atmosphere of city politics not aligning with her professional goals.

Next, the city hired Sandoval as city manager.

Sandoval said he began reviewing city accounts and found the city was missing $6 million.

An independent auditor was hired and found that $3 million had been spent and moved from one account to another, but the audit could not track withdraws and payments, leaving up to $3 million unaccounted for.