Jul 12, 2018 4 min read

The state auditor general’s office will turn over its findings from a review of Monessen’s police pension fund to law enforcement after raising questions about how a new plan manager was selected last year.

Auditor General Eugene DePasquale also said he will withhold future state pension aid to the Westmoreland County city until the issue is resolved.

“The contract bidding process was fatally flawed,” DePasquale said.

“The city provided no documents, minutes or records explaining why one firm was selected over another, as required by law,” DePasquale stated in a Thursday news release.

“The appearance of a conflict of interest further clouds the issue,” he said.

State pension aid also will be withheld until the city returns $54,390 in unauthorized benefits that were paid to a retired police officer, whose identity was not revealed, the auditor general said.

He said he will turn over his findings to the state Ethics Commission and attorney general’s office, as well as the Westmoreland County district attorney’s office and the U.S. attorney’s office in Pittsburgh.

The law firm of Dodaro, Matta & Cambest, which has an office in Southpointe, serves as city solicitor in Monessen.

The solicitor asked the auditor general in December to perform the audit after an internal investigation discovered the incorrect pension benefit calculation for the retired officer, the audit states.

The firm said the city terminated the benefits in July 2017.

The retired officer was paid $3,399 a month beginning in April 2016, even though he was not eligible for his pension until 2023, the audit noted.

The law firm said pension benefit protocols were circumvented “to perpetrate a fraud upon the city,” the state audit report noted.

The state audit then raised questions about how the pension fund management firm was hired in December.

A partner who functioned as a managing director at the investment firm is the brother of a partner in the law firm that serves as city solicitor, DePasquale stated in his report.

Questions were raised in December about the hiring of Fusion Investment Group to manage the police pension fund, which was to be assigned to George Matta. His brother, Gary, works for Dodaro, Matta & Cambest, and Gary Matta has attended Monessen Council meetings as solicitor.

Krisha DiMascio, who works for the law firm and represented Monessen last year, said she believes the city followed the rules in hiring Fusion.

“If we violated some procedural thing, we’ll fix it,” DiMascio said.

She said there were other issues she pointed out to DePasquale that were not addressed in the audit report. DiMascio said one of the problems she found was that state nonuniform pension funds were being directed into the police pension fund.

She said Gary Matta is not ethically permitted to attend meetings about the pension fund. All of the records about that fund are in her office, she said.

“He had to completely stay out of the process,” DiMascio said.

George Matta said there was no conflict of interest because he didn’t deal with his brother when seeking the job.

He said he dealt with former Mayor Lou Mavrakis and Councilman Ron Chiaravalle, who died in May.

The law firm and Fusion also share the same suite in a building at 1900 Main St. in Southpointe, Cecil Township, their websites indicate.

“The city solicitor was responsible to see that the pension board and city officials met city and state laws in the bidding of investment fund management professional services,” DePasquale said.

The issues surrounding the pension fund arose during the administration of Mavrakis, who often complained about missing records from the time before he took office in 2014.

Now Mavrakis is facing similar accusations, DePasquale said, as his auditors accused the city of “having no records explaining how the new (pension manager) firm was selected in December.”

Mavrakis said he would need to read the audit report before commenting on its findings.

“I’m out of the picture,” Mavrakis said Thursday.

The city’s current mayor, Matt Shorraw, raised questions about the hiring of Fusion after he took office in January. He posted DePasquale’s news release on his personal Facebook page Thursday, stating he was glad the auditor general was “looking out” for small communities.

“This is one of the reasons I’ve had so much push-back,” Shorraw stated in the post. “Politicians rarely like honest men.”