By Shavonne Potts
spotts@salisburypost.com
SALISBURY — A state prosecutor said Friday former Sheriff George Wilhelm “rebuffed” concerns from within his department about missing cash — money his former secretary is charged with embezzling.
Jim Coman, a prosecutor with the state Attorney General’s Office, did not say in a court hearing that Wilhelm knew about the embezzlement. But he said the secretary, Kathy Hudgins, has admitted an affair with the former sheriff.
Wilhelm did not return repeated phone calls seeking comment.
Hudgins, along with her attorney, Salisbury’s James Davis, was in court all day Friday to discuss evidence and other key pieces of information Davis plans to use in her defense.
Hudgins was charged in 2010 with eight counts of embezzling more than $56,000 from the Sheriff’s Office over several years. Hudgins was the personal secretary to Wilhelm, who retired in November.
Hudgins was placed on administrative leave in March 2008, resigned on June 17, 2008, and was indicted in May 2010.
The money taken, according to the indictments, was cash for concealed carry and pistol purchase permits. The state and county get equal portions of the fees, once a processing charge is taken off the top. The money was alleged to have been taken July 1, 2003, through March 25, 2008.
The problem of missing money came about when the state didn’t receive its share of fees collected for the gun permits.
“She made a voluntary statement about the relationship,” Coman said.
Coman said Hudgins denied taking the money and “tried to blame other people,” but did not deny a relationship with Wilhelm.
“It’s been rumored. People have known about it,” Coman said of the alleged affair.
It is unclear if this information will be part of the state’s evidence during the trial.
Coman did not confirm whether he’ll use the information regarding the alleged affair or whether he’ll call the former sheriff as a witness.
Superior Court Judge Forrest “Don” Bridges listened to Davis in court Friday as he read through multiple motions asking for the prosecutor to provide evidence to the case, including a detailed explanation of an independent audit that was done in 2008.
Coman said the state provided the requested information, but will double check for more specific information.
Sam Leder with Potter & Co., P.A., mentioned in his audit to the county in 2008 that daily cash receipt registers were not being compared to the corresponding deposit slip by different employees. Receipts were handwritten.
Someone working the front desk could take a payment for a permit, but ultimately Hudgins was responsible for taking the deposit, Coman said.
Davis said he believes the evidence will show the money came through other people with lots of access and through other locations.
The Sheriff’s Office has a satellite office in Landis that often took cash payments for permits. No other person has been charged in the matter.
Davis requested a forensic accountant to review that audit.
Davis said he’s not an accountant and needs someone who can look at the evidence that was submitted to make it more clear. He wondered if an online audit report was the “complete report.”
The audit alone is more than 300 pages.
Much of the trial is expected to come from the audit since there are no confessions or witness statements.
Davis also requested a copy of any money handling policy or procedure in place at that time.
Coman said he did not find evidence of a written policy in place, but there was a procedure in place.
Coman also discussed a confidential informant, whom the prosecutor did not name, but that person said they knew why the money was taken.
“The money was taken because she developed a drug habit,” Coman said.
He does not expect to call the informant to testify.
“Is there evidence of the defendant’s drug use other than through this informant?” Judge Bridges asked.
There were others who said Hudgins bought “certain” drugs, Coman told the court.
Davis said the people who can “corroborate” his client’s alleged drug use are people who frequent the court system as defendants themselves.
Davis initially requested either a change of venue or to bring jurors from out of town.
Davis said he realized that was not cost efficient.
He also pointed to regular news accounts of the incident as possibly contaminating a jury pool.
Judge Bridges disagreed, looking through clips provided to him by Davis, saying the articles were balanced. The judge tentatively set the trial for January.
In April, Rockwell Police charged Hudgins in the theft of lottery tickets from S.M. Mart in Rockwell and cashing in the winning scratch off tickets at other stores.
Those charges are still pending.
Contact reporter Shavonne Potts at 704-797-4253.