Clearwood Controversy

Clearwood sits near the city of Yelm on Bald Hill Road and is home to hundreds of residents.

A preliminary look at the Clearwood Community Association’s forensic audit shows that a former bookkeeper likely embezzled “above $300,000 but less than $400,000,” General Manager Mitch Waterman said Tuesday. 

On Saturday, Nov. 9, the Clearwood Community Association Board of Directors will vote on whether to ask residents via a vote for a one-time repayment for those funds while the association awaits prosecution against the bookkeeper who embezzled funds for nearly four years. 

Waterman said while the report is not quite finished, it likely shows that the amount of funds stolen was greater than they anticipated. 

“He’s given us an almost-final report,” Waterman said of the auditor. 

He said the early report also shows the alleged embezzler likely tried to launder the money by transferring it back and forth between accounts, giving the allusion that funds were coming in and out of the accounts when they were ultimately being stashed away into a bank account not owned by Clearwood. 

The homeowners association will host two town halls on Sunday, Nov. 3, and Wednesday, Nov. 6, to discuss the matter.

Last year, Clearwood filed a civil complaint in Thurston County Superior Court, alleging Dolanna K. Burnett, a former bookkeeper, embezzled somewhere around $300,000. According to a previous report by the Nisqually Valley News, the lawsuit alleged Burnett wrote multiple checks and transferred funds to herself multiple times since 2014, covering her actions in the process. 

Burnett had a previous conviction back in 2014 for alleged theft, identity theft and forgery when she worked for the Tacoma Health Department. 

Waterman said he gives a lot of credit to the volunteers and staff at Clearwood for coming forward with concerns nearly two years ago. 

“This place was operated by volunteers that were never trained to work in a corporate manner,” Waterman said. “It took a lot of guts and a lot of chutzpah to stand up and say, ‘There’s something wrong here.’”

The board of directors will hold a special election on Saturday, Dec. 14, to revise the 2020 budgeting process and change the bylaws on voting, Waterman said. 

Clearwood members could also vote on a one-time repayment fee at that meeting, pending a vote passed by the board at the November meeting. 

Waterman said shortening the budget process from a three-year process down to a two-year process will help the homeowners association more accurately predict revenue and expense needs. 

“This is a bottom-up budget,” he said. “Going forward, they’ll be able to accurately forecast what they spend.” 

While Clearwood’s operational fund is feeling the pain from this incident, board President Aaron Lang said the situation is significant considering their funds but not an immediate emergency. 

Waterman agreed and said, if necessary, the homeowners association could transfer funds from its other accounts, such as its capital fund, to help cover operational costs. 

“If it was dire, we would take other steps. Not dire, but a bad situation,” Waterman said. 

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