Fairgrounds investigation released to public

SANDPOINT — For some, a recent investigation proves the misuse of fairgrounds funds, with fingers pointed at a former Bonner County Fairgrounds manager.

For others, that same report — released along with a two-page statement by Bonner County Sheriff Daryl Wheeler — is incomplete, sloppy and factually incorrect.

Wheeler’s statement dives into an investigation involving former Bonner County Fair Manager Darcey Smith’s alleged misuse of fair funds. Along with the statement, Wheeler released a 20-page report of an investigation overseen by Resolve Investigations, LLC.

“It is evident from the report that the losses due to fraud were substantial,” Wheeler wrote in his statement.

The investigation alleges that Smith — who died by suicide during the initial investigation in October 2022 — misappropriated roughly $40,000 in fair funds over the course of four years. Among the incidents the report refers to as evidence are unclear invoices, an unauthorized PayPal account created for fair use, some allegedly missing bank funds and multiple checks paid to individuals for part-time fair work.

The investigators also mention the account balances in Smith and her husband’s bank account in their findings. However, they do not mention fishy deposits amounting to the alleged missing fair funds or provide any other proof as to why the Smiths’ bank balance creates reasonable suspicion.

Smith allegedly paid roughly $20,000 in checks to individuals for part-time work, including her son, whom she allegedly paid over $8,000 to in the span of three years.

Additionally, the report alleges that Smith may have failed to deposit a $5,000 donation check into the fair board’s bank account.

In his statement, Wheeler contended the county’s internal auditors should have reviewed the fairground’s internal controls, a statement that Bonner County Clerk Michael Rosedale says is “factually incorrect.”

“My office is not, and has never been, responsible for auditing fairgrounds expenses other than salaries and benefits, which are tax funded,” Rosedale said in his own written statement following Wheeler’s statement and release of the report. “All other operational expenses at the fairgrounds are funded by revenues generated at fair events and are outside the purview of Bonner County’s internal auditors.”

The investigation was criticized by Kristina Nicholas Anderson, who claimed she was a friend of Smith, calling it a “vague narrative filled with ambiguous innuendos and several blatant inaccuracies.” Nicholas Anderson said a joint statement was planned between Bonner County commissioners, Bonner County Prosecutor Louis Marshall and Wheeler, until the sheriff “went rogue” and decided to publish a statement on his own.

Bonner County Commissioner Luke Omodt confirmed that claim, stating that the five were planning to release a joint statement about the matter but were unable to agree on its contents.

“Rather than continue to work together to serve Bonner County, the sheriff released a statutorily and factually incorrect statement,” he said.

Nicholas Anderson went on to say that Smith was prematurely implicated in the misuse of fair funds without hard evidence regarding any of the instances listed in the investigation. She claims it is merely 20 pages full of generalizations, absent facts and specific numbers.

“Can a deceased person be charged and if not, why has the county spent thousands of dollars pursuing this investigation without any indication they plan to pursue charges against any others involved in this debacle?” she asked in her statement.

It is unclear whether the county or fair board are attempting to retrieve the money allegedly stolen or if the investigation will conclude without retribution.

During the Bonner County commissioners’ Tuesday business meeting, Commissioner Steve Bradshaw brought up Wheeler’s release of the report and read a similar press release, but with a few notable changes.

“[Wheeler’s statement] is full of inaccurate information and can be misleading,” Bradshaw said. “Bonner County and the fair board are looking at ways to recoup at least some of the losses as the fair runs on an extremely tight budget.”

Bradshaw said he believes the investigator to be “a solid, honest man.” However, the commissioner did note the investigator had previously worked for Wheeler in the Bonner County Jail. Additionally, the investigator’s son is a current employee of the sheriff.

“So to protect not only the sheriff, the sheriff’s department, the private investigator that did the audit, Bonner County employees, the board of commissioners, the fair board and everybody concerned, [Prosecutor] Louis Marshall and I have contacted the Attorney General’s office to put a second set of eyes on this investigation,” he said. “They’ll look for discrepancies, anything that could or might be wrong, or to say, ‘Yes, this is a clean and solid investigation.’”

While it is unclear how long it will take the Attorney General’s office to conduct their own research into the issue, many in the community still believe Smith is innocent and is being set up. Nicholas Anderson said she has been working for eight months collecting evidence that proves Smith’s innocence and she won’t rest until she brings her friend justice.

“When you say there is more investigating to do, you are absolutely correct,” she said. “Who wants to help?”