The U.S. Attorney's Office found no evidence of illegal conduct by the Maricopa County Sheriff's Office in connection with violations of county travel policies and the questionable handling of money from an account meant to benefit inmates.

In a letter delivered Monday to County Manager David Smith, U.S. Attorney for Arizona Dennis Burke wrote that after an extensive review of records, a team of prosecutors determined that sheriff's officials did not break any laws on those two matters.

Burke wrote in the three-page letter that his office continues to examine evidence in a larger abuse-of-power investigation of Sheriff Joe Arpaio, sheriff's employees and others.



Report from County Manager David Smith |

Letter from U.S. Attorney for Arizona Dennis Burke

This is the second declination Burke has issued in recent months stemming from his agency's wide-ranging investigations of past conduct by the Sheriff's Office and the Maricopa County Attorney's Office. In June, Burke said the Sheriff's Office did not break any laws when employees took extradition trips in and out of Arizona, although its extradition policy was an "inexplicably exorbitant and baffling unique option for extraditions."

County Manager David Smith said county officials are working to improve cash-handling and travel policies. He had no reaction to Burke's declination letter.

Federal prosecutors have been reviewing the Sheriff's Office's use of public funds and adherence to county policies since fall 2010, after the Board of Supervisors and county administrators raised questions about possible improprieties in matters involving inmate-cash handling, use of county credit cards, extradition funds, the county's travel policy, and the later discovery that the Sheriff's Office had misspent nearly $100 million of restricted jail funds.

County leaders asserted that Arpaio and his staff intentionally misappropriated money. They asked Burke to prosecute sheriff's officials if wrongdoing was found. The Board of Supervisors deputized federal prosecutors to investigate the allegations.

Burke said in his letter that while there appeared to be sloppy money-handling and accounting practices, federal investigators found no evidence of illegal conduct.

The federal inquiry into finances is tied to the larger abuse-of-power investigation. At the direction of Burke and the FBI, a federal grand jury since late 2009 has examined allegations of abuse of power by Arpaio, former County Attorney Andrew Thomas, their employees and others. That grand-jury investigation is ongoing and jurors continue to meet regularly.

Former U.S. Attorney Jose de Jesus Rivera said the letter of declination is likely an indication that the abuse-of-power investigation is ongoing and that the administration wants to focus on what it thinks it can prove.

"I think it shows that they're bearing down on the issues, but it doesn't tell you what they're going to charge or not charge," he said. "If I were a guessing man, I'd say they're trying to narrow the case to make it as lean and mean as possible."

Former U.S. Attorney Paul Charlton agreed, saying, "The silence as it relates to (the abuse-of-power investigation) is as telling as the declinations are."

Sheriff's Deputy Chief Jack MacIntyre called Burke's letters of declination "left-handed exonerations. All it does is reopen the ability of the U.S. Attorney's Office and the county to throw stones at the Sheriff's Office.

"Outside of our office, has the U.S. Attorney's Office ever gone out of its way to publish lack of prosecution? It seems to be some kind of selective procedure to deal with the Sheriff's Office," MacIntyre said.

While finding no illegality, Burke's assessment took issue with the manner in which the Sheriff's Office's handled certain finances, saying the Sheriff's Office may have violated fiduciary obligations as manager of funds it holds in trust for inmates.

The Sheriff's Office maintains an account to hold money taken from inmates who are booked into jail, as well as funds deposited on their behalf by friends and family. Last year, county officials alleged the Sheriff's Office mismanaged money from that account.

According to Burke's letter, from roughly 2006 through 2008, sheriff's employees withdrew $1,500 from the account every Friday to provide cash for money drawers at the Lower Buckeye Jail. Burke said the money was mostly used for change, not the refunding of the trust-account deposits that were made on behalf of inmates. Based on records, Burke wrote, it appeared sheriff's officials did not consistently deposit all cash entrusted to it from inmates and their families.

"Instead, MCSO engaged in a questionable practice of refunding inmates with whatever cash happened to be available at the MCSO jail, cash that sometimes had been entrusted to MCSO on behalf of other inmates," Burke wrote. "MCSO's failure to deposit the cash into the inmate trust account, and its subsequent use of the cash for another purpose, may have violated its fiduciary duty in managing the inmate trust account."

The Sheriff's Office changed its policy in 2008 after it failed to keep sufficient cash on hand to repay inmates when they were discharged from jail. The agency increased its withdrawals to $35,000 weekly to make sure it had enough money to repay departing inmates.

While the handling of the money was questionable, Burke said it was not criminal, noting, "It appears that the trust monies received by MCSO are mostly accounted for, and there is no evidence that anyone at MCSO embezzled monies for their personal benefit."