Wednesday, June 15, 2011

Embezzlement Ties to the City of Sioux Falls

Per a KELO-TV report, a former accountant at SDN Communications has been charged with embezzling close to $400,000 from SDN Communications over a period of 10 years.  Although this is very serious business for SDN Communications, this news also affects the City of Sioux Falls because the charged accountant, Brad Whitsell, served on the City's Internal Audit Committee, both as a member and as it's chair.

This information has personal ramifications for City Councilor Vernon Brown who is employed by SDN Communications. Although they shared an employment relationship, working at the same company, they did not work in the same departments. Whitsell was in Finance and Brown was in Marketing. Brown had no managerial oversight over Whitsell at SDN Communications.

Here are the facts as related to me by Councilor Vernon Brown:

  • The Council was having trouble filling the Audit Committee position because it was a brand new board. Councilor Brown asked Brad Whitsell if he had an interest because his resume met the qualifications. Whitsell expressed an interest in serving on this volunteer board and Councilor Brown subsequently forwarded his name for consideration. Councilor Brown abstained from voting on his appointment and re-appointment to the Audit Committee.
  • Councilor Brown did not serve as a council representative on the Internal Audit Committee because of their employment relationship.
  • Brad Whitsell received high marks from committee members for his work on the Audit Committee in setting up internal controls for city government.
  • It was communicated to Mr. Whitsell, through his attorneys, that he should immediately resign from the Internal Audit Committee at the City. He did not do that and Councilor Brown stated he could not jeopardize the investigation by going public with the information.
  • Volunteers who are appointed and serve on the Internal Audit Committee do not have access or touch city dollars. Their work is related to process and procedure audit and review.
  • Investigators knew about Mr. Whitsell's voluntary role on the committee and knew no city dollars were at risk.
People trusted Whitsell, pure and simple. It would appear he hoodwinked a lot of people, both at SDN and at the city.  Unfortunately for Councilor Brown, he was caught between the proverbial rock and a hard place.

This was a highly confidential investigation for SDN Communications and a personnel issue that required confidentiality until an investigation was completed.  His employment with SDN Communications is very separate and distinct from his public role as a city councilor.

The facts are the facts. Councilor Brown understood what conflict of interest meant with respect to his personal employment relationship and his role as a city councilor and abstained from any formal or official actions regarding Whitsell's appointment or service on the Internal Audit Committee.

Vernon Brown has served the city of Sioux Falls as a city councilor for almost 8 years. Any comments or innuendo regarding these charges related to SDN Communications and his employment relationship to the accountant that infers or taints his public service is unjust and plain unfair.


  1. "It was communicated to Mr. Whitsell, through his attorneys, that he should immediately resign from the Internal Audit Committee at the City. He did not do that and Councilor Brown stated he could not jeopardize the investigation by going public with the information."

    How would he have jeopardized the investigation? He didn't have to tell the public. All he had to tell is the city attorney and Whitsell. I'm sure some agreement could have been met, and if not he could have been asked to leave in a polite letter, "We no longer need your service. Thank You." . It infuriates me even more knowing Brown knew about the investigation and sat on his hands. That is suspect in itself.

    And BTW, if Mr. Brown wants to respond to a blog post on my site, maybe he should email ME instead of YOU. Just a thought. I have a feeling Vernon is going to have a lot of explaining to do over the next few days and weeks.

  2. If any of your readers are interested they can view Mr. Whitsell chair his last city audit committee meeting on He speaks about his resignation from the committee in the 3/22/11 meeting. It is number eight on the agenda. In light of what has been revealed the last couple of days, it is fascinating viewing.

  3. "I have a feeling Vernon is going to have a lot of explaining to do"

    Why? He didn't embezzle from his company, he s not the CEO of the company he works for and he abstained from all votes on appointing and reappointing this guy to the audit committee. I would be more worried about the rest of the members of the city audit committee who actually worked with this guy on city issues and who probably elected him chairman of their little group. Who is the audit guru for the city council.? He's the one who should have some explaining to do.

  4. DaCola is a kook. Nobody should take ANYTHING that guy says seriously.

  5. DaCola is a kook. Nobody should take ANYTHING that guy says seriously.


    Sad. Really sad. You fine folks that come here and rant about what a crook we have for a mayor would have done yourselves a huge service to the community IF you'd have have payed attention to DaCola a little over a year ago. His was the ONLY place you could go to get a heads up on guys like honest mike.

    DaCola was light years ahead of anyone on city issues AND was the first place,by months, to expose another wolf in sheeps clothing...kristi noem. Gotta give Cory Heidelberger over at the Madville Times a kudos also. Two of the very best blogs in the state. Jennifer, although tainted just a little bit by her many years in city government, also does a standup job.

    Polly Amalo

  6. I agree with @ 11:57PM. This guy lives for controversy and unfortunately takes pleasure in negativity.

    Anyone that personally knows Vernon Brown would testify to the strength and integrity of his character.

  7. I love this, has anybody at the City even suggested that anything this guy did while volunteering for the City was wrong?

    Anyone think this is another Victim of our Great State's Video Lottery Program. Maybe, maybe not?

    Most of us that do not Gamble, think that it is a Tax we do not pay. My guess is that we forget the cost of things like this.

  8. l3wis is just ahead of the curve...and you can't handle it. Negativety??? LMAO. This blog site, with regards to huether, is nearly the ultimate in negativety. On the other hand, if huether had voted for the DT site, you all would cannonize him and declare another city holiday every year in his honor. To suggest honest mike paraded his daughter in front of the cameras the other nite is pretty far fetched. Yet you all believe that's what he did. Did it ever occur to you she did what any other daughter would have done for their father...VOLUNTARILY? No. Not this crowd.

    And Vernon Brown? Give me a break. There is not a spending plan or regressive tax increase this guy doesn't salivate over.

    Check out the posting dates on these blog entries. Most of you prolly never heard of either one of em at the time. Yet DaCola NAILED em early and often.

    Polly Amalo

  9. Politicians love to say "leave my family out of it", and 99% of the time it is a valid request. But Huether and his daughter crossed the line on Monday night, more like obliterated it, and that WILL come back to haunt the Mayor at some point. They just made "family" fair game! Same goes for Jim Entenman. Hildebrand's ethics complaint involved Councilor Entenman, yet it was Entenman who brought his family into the matter when he launched into a scripted tirade at an earlier council meeting. Entenman and Huether are neighbors, and Entenman was main sponsor of the Arena site resolution. Anyone else think they don't get together and plot strategies on a regular basis?

  10. Sorry but who cares, Polly Amallo. LMAO. I didn't know there was a contest between these two blogs. I guess only in your and South DaCola's mind.

  11. Don't believe there is a contest either. Was only replying to this.

    "This guy lives for controversy and unfortunately takes pleasure in negativity."

    It is my duty as a citizen to make critical decisions when I enter a voting booth. That's what we need journalists for. Unfortunately there aren't many of them around. That's why huether is mayor. That's also why I come to places like this, and DaCola's. Both pretty good watchdogs over what is happening in this city.

    Being a watchdog means bringing out the negative. DaCola, AND this place, do that well. Saying DaCola dwells and pleasures in negativity is wrong. As wrong as it is to say the same about Jennifer.


  12. Polly Amalo is a kook. Nobody should take ANYTHING that guy says seriously.

  13. DaCola wasn't ahead of any curve, ya goofball. The Dems voted for Huether. The Repubs split amongst everyone else. In the runoff, Huether won because he was the lesser of two evils. Staggers is just as much of a kook as you and DaCola. He would've represented you well.

  14. Goofball? Yeah. Right. That election had nothing to do with party lines. I'm a slightly left leaning liberal democrat and voted for a tea party attending Kermit Staggers. Does that seem like a party line vote to you? As it was with many SF voters. I really don't care what your "party" affiliation might be. Most here voted for your man mike because he was not kermit. Just like his handler, hildebrand painted it for him. YOU got what YOU paid for. Had YOU listened to DaCola, YOU would be happy with the knowledge honest mike would be adoring himself in his retirement lake cabin mirror instead of on channel 16, and kelo, and ksfy, and kdlt, and the argus.


  15. your so passinate about writing and look forward to many more updates!! Internal Audit Career