Leaders of Iowa town jailed in long-running corruption case

Published 6:30 am Wednesday, February 17, 2021

IOWA CITY, Iowa — Years of government corruption preceded the arrests of five officials from a small northwestern Iowa city, including the mayor and police chief, according to prosecutors and a state audit.

The Armstrong officials embezzled tens of thousands of dollars in public funds, falsified public records to conceal wrongdoing and used city property for personal gain, prosecutors allege in a charging document that details allegations dating to 2013.

The arrests stunned the community of 900 people, which is located near Iowa’s border with Minnesota and about 40 miles from the popular Okoboji vacation area in the state’s northwestern corner.

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Defense lawyers said they were trying to learn what prompted authorities to act against the officials now, years after some of the alleged misconduct became public in a September 2017 audit  report.

“It’s somewhat of an odd case. Usually you don’t see these kinds of charges coming out of a state audit report. Why this one took the turn it did, I’m not quite sure yet,” said attorney Ed Bjornstad, who represents former city clerks Connie Thackery and Mary K. Staton. “It’s old stuff.”

A judge allowed Staton, 35, to turn herself in Tuesday on misdemeanor charges. She was quickly released from jail after posting bond.

The other four defendants are jailed and facing a host of felony charges. They are Greg Buum, 69, who has served most of the last decade as Armstrong’s mayor; the city’s police chief Craig Merrill, who is Buum’s son-in-law; Thackery, 66, who retired in 2016; and the current city clerk, Tracie Lang.

Buum, Thackery and Lang were arrested Friday afternoon and have been jailed since on a cash-only bond. Bjornstad said he was trying to bail out Thackery, whom he described as “the sweetest, nicest lady” but infuriated about the charges.

Investigators arrested Merrill, 43, across the border in Minnesota while he was reportedly on an ice fishing trip. He is in jail in Martin County, Minnesota, while awaiting extradition.

Lynn Hicks, a spokesman for the Iowa attorney general’s office, which is prosecuting the case, said the case has been under active investigation for years.

Prosecutors allege in a charging document unsealed Monday that Buum, Merrill and Thackery committed “ongoing criminal conduct” for financial gain from 2014 through 2020, a felony charge that carries up to 25 years in prison.

Buum and Merrill are charged with first-degree theft for more than $10,000 worth of checks that were improperly made payable to Merrill, according to prosecutors. Buum and Thackery are charged with theft for checks that went to other city employees and a credit card company. The total amount of the alleged thefts are unknown.

The mayor is also accused of directing Staton to falsify financial statements to cover up missing revenue from the city’s pool, and of using a saw owned by the fire department to benefit a private carpentry business.

Perhaps the strangest allegations are against Chief Merrill, who is charged with assault with a dangerous weapon for improperly using a city-owned stun gun against others in a non-official capacity on at least two occasions.

At a 2016 party where he raised money to pay for stun gun darts, Merrill used the weapon to injure a city maintenance employee and against another person around the same time, the charging document says. He also allegedly misused the money from the fundraiser and received a paid vacation from the city that summer in violation of Iowa law.

Lang is charged with falsifying several public records, including a 2017 petition received by the city, a financial report related to the city’s streets and the minutes of City Council meetings.

The 2017 state audit described the city’s financial management as a mess. Investigators found tens of thousands of dollars in utility collections that were either unbilled or not properly deposited, and thousands more in improper payroll expenses and tax penalties.

City officials told auditors that they lost all of their financial and utility records when a computer crashed in 2016 and they did not have any backup files. Utility meters were not functioning, water bills weren’t issued after the computer crash and the sewer tax was not properly charged to some customers, the audit found.

Auditors said they found several old checks lying around that hadn’t been deposited. The sheriff’s office had also seized a bag with “a significant amount of cash” from the city after officials complained that no cash for pool or utility billings had been deposited for months.

Staton, who was then the clerk, told auditors that Buum, Merrill and other city employees had access to City Hall files and financial information when she was gone. She said that mail disappeared and money went missing on multiple occasions when she was absent.

Buum was first elected mayor in 2013 as a write-in candidate and was voted out of office two years later. He returned after winning a special election in 2016, and won reelection in 2017 and 2019.

The city took in about $1.4 million in revenue in the most recent fiscal year and had $1.1 million in expenses, a report shows.

Attorney Bethany Brands, who is representing Lang, said she was still trying to learn what prosecutors were alleging and declined to comment otherwise.

An attorney for Buum didn’t immediately respond to a message.