DUBOIS – DuBois City Manager John Fred “Herm” Suplizio was arrested Monday for allegedly stealing hundreds of thousands of dollars from public accounts over a period of time and filing fraudulent tax returns.
In April of last year, a search warrant was executed on Suplizio’s residence and offices and records of his banking activities were seized.
The charges were filed as a result of an investigation and grand jury proceedings covering Suplizio’s finances starting in 2014.
Suplizio, in addition to being city manager since 2010, was also the executive director of the DuBois Area United Way, was affiliated with the DuBois Volunteer Fire Department and handled funds for DuBois Community Days.
The total alleged taken by Suplizio, 62, is over $620,000, according to a press release from the Attorney General’s office.
Monday he was charged by state police and a special agent with the AG’s office with five felony counts of theft by unlawful taking, felony restricted activities-conflict of interest, eight misdemeanor counts of fraudulent sales tax return and misdemeanor misapply entrusted property.
He was arraigned Monday when he also waived his right to a preliminary hearing. He is free on $100,000, unsecured bail.
DuBois City Solicitor Toni Cherry issued the following statement.
“On behalf of all of City Council, I share our disappointment upon learning today about the allegations against our long-time City Manager, Herm Suplizio.
“For over two decades, Herm has served DuBois with a passion and determination that has grown its reputation and profile well beyond that of similar cities.
“Out of respect for Herm, as well as the judicial process, we will reserve comment on these allegations until a more appropriate time.
“However, council will remain vigilant in our oversight of city funds and its employees. We will continue to monitor the matter and further our own review of the facts moving forward.
“We are committed to ensuring integrity is maintained within DuBois City government, which, we believe epitomizes Herm’s tenure as city manager.
“We appreciate all the kind words in support of Herm and the city that we have received from members of the community, and we thank you all for your patience with this deliberative process.”
According to court documents, the investigation began after state police received an anonymous letter from “concerned citizens” who noted that Suplizio appeared to be directing United Way donations to the City of DuBois.
This activity was later determined to be permissible because they were designated for a specific project, the city’s athletic fields. But the investigation continued and the “fraudulent activity was ultimately discovered,” it says in the criminal complaint.
Testimony to the grand jury revealed that “over the course of several years, Suplizio withdrew large sums of cash from the DuBois Volunteer Fire Department bank accounts associated with the DuBois Community Days.”
This was possible because these accounts although listed as municipal, were not monitored by the city officials.
There are four bank accounts associated with the Community Days Fund, which is not a separate non-profit entity but used the tax identification from the city, which should also have been monitored by officials.
Reportedly, quarterly payments from Advanced Disposal Systems of up to $60,000 per year to cover billing for the company’s waste removal were also put into these accounts instead of the city accounts.
“In reality, this arrangement for ‘billing’ was simply a way for Suplizio to receive ‘kick-backs’”, it says in the complaint.
Credit card records show from June 2014 to February 2022 that he had $677,120.51 in purchases of which over $376,000 was for public expenses. Payments totaling $102,244.66 allegedly came from three public accounts.
In addition, a “good portion” of the public expenses were later used as tax deductions on his personal income tax filings.
From 2014 to 2021, Suplizio received reimbursement payments from the city’s general fund for mileage and his personal cell phone, despite not having submitted any reimbursement forms. These payments totaled $26,077.56. He later claimed these expenses as not reimbursed on his taxes, according to officials.
During this same time, Suplizio allegedly received reimbursements from the DuBois Area United Way for the same expenses. This totaled $20,640.
“It was determined that between October 2015 and January 2020, Suplizio paid his Visa personal credit card bill with eight checks written on the DAUW account totaling $10,252.72.”
This gives him a total of alleged fraudulent transactions of $41,933.30 associated with the DAUW checking account, according to court documents.
The complaint lists fraudulent transactions with three of the four accounts associated with the CVFD.
The total from the parade account is reportedly $99,108.40 with the additional tax fraud of $56,894.77.
The Community Days CD account had numerous “questionable withdrawals” including withdrawals that reportedly were deposited later to his personal accounts or through the parade account into his own.
Among these withdrawals were funds allegedly used to make political contributions.
The total amount of fraud on this account with the tax amounts is estimated at $142,934.56.
The DVFD Community Fund checking account also showed fraudulent activity totaling $250,867.21, according to investigators.
Another part of his alleged fraud involves moving money between the community and his personal accounts and into an investment account from which he later withdrew the funds.
“The personal checking and savings accounts used to fund these investments were linked back to the fraudulent transactions involving public funds.”
In addition, Suplizio is accused of using part of this money for gambling at a casino in Salamanca, New York. This total is estimated to be $101,790 from 2014 to 2021.
The last accusation against Suplizio involves the sale of water from the city to several fracking companies some of which went directly to Suplizio. This total is reportedly $12,323.57.
Three prior payments from the companies, which were unable to be verified because they were made between 2004 and 2015, allegedly exceeded $1 million.