Timothy David Ray

Timothy David Ray

Timothy David Ray lost his bid to serve as the permanent clerk of 1st City Court in November, but that didn’t stop him from cutting a number of suspicious checks from an obscure government bank account just before he left office, according to a recent audit.

Ray gave $4,766 to a Plaquemines Parish pastor for shelving that was never completed, $5,150 to an Apple store employee for questionable moving expenses, and $360 to a printing company for “business cards” that might have been unnecessary, forensic auditors said.

In total, the auditors said that Ray spent more than $10,000 in public funds on suspicious expenses during his last two weeks in office — findings that prompted New Orleans judges to refer him to the FBI and local law enforcement officials on Wednesday.

The audit was jointly commissioned by the judges of 1st City Court and Civil District Court. 

Ray, an attorney and political consultant who mounted an unsuccessful bid for the City Council in 2017 before losing the clerk’s race to former state Rep. Austin Badon in 2018, could now find himself in legal hot water.

The auditors raised the prospect that Ray spent the money for personal or political purposes, which would be illegal.

Ray has denied wrongdoing and alleged in letters to the judges that Badon is pursuing a political grudge. He did not respond to requests for comment on Thursday.

The examination of his expenses, which was completed Feb. 26 by the local Brown Forensic Accounting firm, is a rare moment in the spotlight for the under-the-radar clerk’s office, which maintains records for small claims and eviction lawsuits on the east bank of New Orleans.

Ray worked as a campaign manager for longtime former clerk Ellen Hazeur before she was elected to a Civil District Court judgeship in March 2018 and appointed him to fill her position on a temporary basis.

Hazeur, who declined to comment, is not accused of any wrongdoing in the report.

Ray served as clerk for only seven months and has never been elected to local office. But during his short tenure, auditors said they found a trail of concerning expenses.

The probe centered on the “Capital Improvement Fund,” an office account that collects interest from two separate escrow accounts for lawyers and litigants. That interest is allowed to be used for the court's operating expenses.

In an 18-page report, the auditors said Ray’s payments from the fund during his last weeks in office seemed dubious. Many of the checks Ray wrote were first reported last month by WVUE-TV.

He paid $4,766 to a Plaquemines Parish pastor named Merlin Flores Sr. on Nov. 2, four days before the election. Ray later told the judges that Flores was supposed to install upgraded shelving at the clerk’s office, which would speed up filing.

However, the auditors said that after paying a visit to the courthouse, it appeared that no shelves were ever installed. Flores told WVUE-TV that he received the money for providing a quote, not for actual labor.

The auditors said their suspicions were further raised by the fact that Ray cut the check three days before the date on an invoice. They also noted that Flores’ total quote for the project on the invoice, $9,662, was just under the $10,000 floor that would have triggered a public bidding process.

Ray claimed that a rival outfit named Cox & Cox did submit a much higher competing bid, but the auditors couldn’t find the firm in the secretary of state's business records.

In a Dec. 10 letter, Ray said Flores “completed repairs and retrofitted the existing shelves” for a different type of file and was supposed to start installing new shelves later.

Another check that raised auditors' suspicions: $5,150 for a man named Morgan Jones on Nov. 13, the week after Ray lost the election.

Ray said he gave Jones the money to move files from the clerk’s office to a private storage facility on the West Bank. Yet the storage company had already agreed to pick up the records at no additional cost as part of its contract, the auditors said. And once again, the check was dated before the invoice.

Attempts to contact Jones were unsuccessful Thursday. According to the auditors’ report, he described himself as an Apple Store employee on a resumé posted online.

The invoices purportedly provided by Jones and Flores were vague and lacked corporate logos, auditors said. Taken together with their odd timing, the auditors said that might “be indicative of the invoice being created after the fact, when Mr. Ray no longer had access to the clerk’s checking account.”

Ray also spent $360 on “business cards” just after the election with the same printing firm that created his campaign literature, according to campaign finance disclosures. Yet Ray was provided with 500 business cards — at the court’s expense — at the start of his short stint in office.

The auditors said the “business card” expenses might actually have been meant for “some sort of printing and/or direct mailing related to Mr. Ray’s campaign.”

In a letter to the judges, Ray said he spent $240 on business cards for deputy clerks. It's not clear if he was referring to the same expense.

There was also a sign that Ray tried but failed to spend more public money, the auditors said.

After the court’s judicial expense fund denied Ray’s request to spend $998 on a brochure about the small claims process — because it featured a campaign-style biography and picture of Ray — he instead tried to pay for the brochures with the “capital improvement” money on Oct. 31. The attempt went awry because of an error on the account number on the check, according to the audit.

The checks all added up, the auditors said. When Ray took office on April 25, the account contained $44,872. Its balance had dropped by more than 20 percent by Nov. 16, when Ray left office and Badon was sworn in.

In total, the auditors said, Ray may have “potentially misappropriated, converted, misused or otherwise wrongfully taken public funds in the amount of $10,276.”

Badon told the judges that upon taking office, he began the standard process of reviewing all the clerk’s bank accounts. He quickly became concerned about the capital improvement fund, he said.

After questions about his spending habits were raised, Ray cast the entire issue as a continuation of his electoral battle with Badon, who beat him 64 percent to 36 percent.

Ray claimed that he had offered to sit down with Badon and walk him through the clerk’s finances after the election, but Badon ignored him.

“Once it became clear the incoming clerk would not meet with me to discuss the office and his transition, I continued to handle the affairs of the office, but in a way that would ensure the incoming clerk would not inherit unpaid vendors or insufficient space to prepare for 2019 filings,” Ray said.

He said the judges would be familiar with “the animus that naturally develops during a campaign, but knowing when and how to move forward once a campaign is over is essential to success.”

However, those same judges sided with Badon after the release of the fraud examination report.

Chief Civil District Court Judge Paulette Irons, Senior 1st City Court Judge Angelique Reed and Badon all signed letters referring the matter to the FBI, the U.S. Attorney’s Office, Orleans Parish District Attorney Leon Cannizzaro and the state Office of Disciplinary Counsel, which investigates attorney misconduct.

Follow Matt Sledge on Twitter, @mgsledge.