Audit Objective
Did the Hannibal Fire Company (Company) Board of Directors (Board) provide oversight of Kartway racetrack (Kartway) fundraising activities?
Audit Period
March 1, 2017 – December 31, 2023
Understanding the Audit Area
A fire company board should provide oversight of fundraising activities conducted on fire company property to help ensure statutory compliance, establish accountability, safeguard the company’s assets and its reputation and fulfill its fiscal responsibilities. In practice, oversight commonly includes requiring advanced approval of fundraising activities, maintaining detailed fundraising reports, documenting revenues and expenses, performing independent reviews of collections and deposits and reporting results to the membership and/or governing board.
From 2017 through 2022, the Company received approximately $25,000 from the Kartway fundraiser.
Audit Summary
The Board and Company officials did not comply with the statutory requirements set forth in New York State General Municipal Law (GML) Section 204-a when they engaged in a non-permissible fundraising activity known as Kartway, a go-kart racetrack that operated on Company property. In addition, the Board did not provide oversight or otherwise monitor Kartway’s activities. Instead, the Board relied on an unincorporated “Association” to handle all racetrack operations and cash collections and did not require the Association to provide any financial reports. As a result, the Board failed to ensure statutory compliance and establish basic financial controls or accountability that resulted in at least $13,100 being misappropriated without detection and the Company’s reputation being harmed.
Additionally, the Board did not:
- Develop any written policies or procedures for recording and reporting fundraising activities.
- Verify the Company had adequate liability insurance coverage to help protect the Company in the event there were injuries or damages during race events.
As of January 12, 2023, the Company dissolved the Kartway fundraiser and ceased all racing operations. In February 2024 the former fire Chief (former Chief) and his father, a volunteer firefighter, were arrested for allegedly stealing from the Company. The former Chief was charged with grand larceny in the third degree, offering a false instrument for filing in the first degree and falsifying business records in the first degree and his father was charged with grand larceny in the fourth degree. In May 2025, the former Chief pled guilty and agreed to pay $9,838 in restitution. In September 2025, the court dismissed the indictment against the former Chief’s father on the grounds that it was legally insufficient. In May 2026, the former Chief was sentenced to three years’ probation and paid full restitution.
The report includes five recommendations that, if implemented, will improve the Company’s fundraising collection activities by helping the Board to ensure accountability, safeguard the Company’s assets and fulfill its fiscal responsibilities. Company officials generally agreed with our recommendations and their response is included in Appendix C.
We conducted this audit pursuant to Article V, Section 1 of the State Constitution and the Office of the New York State Comptroller's (OSC) authority as set forth in Article 3 of GML. Our methodology and standards are included in Appendix D.
The Board has the responsibility to initiate corrective action. We encourage the Board to prepare a written corrective action plan (CAP) that addresses the recommendations in this report and forward it to our office within 90 days. For more information on preparing and filing your CAP, please refer to our brochure, Responding to an OSC Audit Report, which you received with the draft audit report. We encourage the Board to make the CAP available for public review.