A small village in Illinois is suing a major bank over allegedly improper spending by the village’s former mayor. The town of Dolton, which is about 30 minutes south of Chicago, said the bank should have prevented former Mayor Tiffany Henyard from improperly spending nearly $2 million in taxpayer dollars.
Lawsuit filed
The Village of Dolton’s 26-page complaint accuses Fifth Third Bank of failing to abide by a 2021 resolution put in place to control village spending.
Download the SAN app today to stay up-to-date with Unbiased. Straight Facts™.
Point phone camera here
That resolution determined only the mayor and village clerk were authorized signatories on all village bank accounts. It also required every check issued by the village to contain both the mayor and village clerk’s signatures before any payments would be valid.
“On and after May 2021, Fifth Third Bank acted in bad faith because it knowingly and intentionally paid checks on behalf of the Village of Dolton that it knew should not have been paid,” the complaint reads.
The village is seeking to recoup all the money lost.
“It’s kind of unusual,” Bart Hildreth, professor emeritus of the Andrew Young School of Policy Studies at Georgia State University, told Straight Arrow News.
“The bank is typically contracted to do certain business activities with a city through some depository agreement, or some form of an agreement, and that would state who has the authority to transact business with the bank on behalf of the city,” he added. “Perhaps the mayor and the treasurer, or just the mayor, or whatever the case may be. So, that would determine, really, what the bank’s responsibility is for monitoring one or more transactions on behalf of the city.”
Those depository agreements are not typically made public, so SAN was unable to determine what is said in this particular case.
“It’s hard to know on the surface, whether or not there’s any standing there for the city to assert that the bank was supposed to oversee particular transactions,” Hildreth said. “However, if the depository agreement said that the vouchers had to be, or checks had to have two signatures to them, and they processed them with just the mayor’s signature. Then, that’s a stronger assertion.”
Either way, this could be a chance for the village to get some of that money back.
“[They’re] just hoping that the bank might find that it’s a nuisance suit and settle,” Hildreth said.
The bank has not commented on the lawsuit.
“Ms. Henyard has moved on with her life,” Beau Brindley, Henyard’s attorney, told WGN. “The chaos and mismanagement of Dolton at the hands of the board of trustees caused damages that will continue to reverberate for years to come.”
Henyard spending
Notably not named in this lawsuit is the former mayor Henyard.
“The bank is a deeper pocket than an average mayor, and also the bank may be non-local, so it’s easier to sue an institution,” Hildreth said.
Fifth Third Bank is headquartered in Ohio.
Henyard was accused of spending millions of the village’s funds on trips, personal benefits and security details. The FBI has also begun investigating the matter, but Henyard has not faced any criminal charges.
Henyard was found in contempt of court and fined $1,000 per day for ignoring court orders to comply with FOIA requests from Illinois Leaks.
Last year, Jason House handily defeated Henyard in the mayoral election, with House taking 88% of the vote.
Henyard is now promoting a new tell-all autobiography she calls “Standing on Business.” It comes with a $99 price tag on a self-publishing website and it’s allegedly the first of a three-part series.
City issues
The new administration in Dolton is likely going after the bank because Henyard’s alleged spending put the village in significant debt. The village’s bank account reportedly fell from a $5.6 million balance to a $3.6 million deficit according to Fox 32 Chicago.
“As a direct and proximate result of Fifth Third Bank’s conduct, the Village of Dolton has lost significant taxpayer dollars and has been required to incur debt at a cost to be determined at trial,” the suit reads.
Hildreth said another issue could be how long the village has done business with the bank.
“A lot of times, local governments will continue doing business with a bank for quite a long time,” he said. “But then if they have to go through that competitive bidding process, they might choose a new bank and then they’re willing to sue a bank that they haven’t had a longstanding relationship with.”
