RALEIGH, N.C. — A comprehensive investigation by the North Carolina Office of the State Auditor has uncovered significant fraudulent activity and financial irregularities within the Town of Mount Olive’s municipal operations, resulting in hundreds of thousands of dollars in lost revenue and systematic abuse of public resources.

Investigation Origins and Scope

The investigation was launched following allegations received through the State Auditor’s anonymous tipline. The probe focused primarily on Mount Olive’s Water Department and Municipal Airport operations, revealing what auditors describe as concerning patterns of misconduct and financial mismanagement.

Water Department Fraud Uncovered

Employee Manipulation of Utility Systems

Investigators discovered that a Water Department employee systematically voided hundreds of water cutoff fees each month—fees that are typically issued when customers fail to pay their monthly utility bills. In a particularly egregious abuse of the system, the same employee manipulated the utility system to prevent her own water service from being disconnected despite failing to pay her own bills.

Town Commissioner’s Unpaid Bills

The investigation revealed that a sitting town commissioner failed to pay his utility bills for several months without facing service disconnection. Records show his $100 cutoff fee was voided nine times throughout the year, and he made no payments on his utility bill during 2024 until after the State Auditor’s Office received the initial allegation. At that point, his outstanding balance had reached $942.

Massive Revenue Loss from Rate Errors

Perhaps most significantly, investigators found that Mount Olive’s utility rates were improperly entered into the town’s billing system, resulting in more than $210,000 in lost revenue to the municipality.

Airport Operations Under Scrutiny

The investigation also uncovered irregularities at Mount Olive’s municipal airport. Auditors found that fuel purchases, which the airport operator was contractually obligated to make, were instead being made by the Town of Mount Olive itself. Additionally, the airport operator was allowing customers to purchase fuel on in-house credit without proper oversight.

Mount Olive’s finance director was found to have no established process for verifying monthly fuel commission invoices submitted by the airport operator, creating additional opportunities for financial discrepancies.

Official Response

“Proper management at the local level is incredibly important to ensuring resources are not abused and protocol is followed,” said State Auditor Dave Boliek. “Our Investigative Division took a deep dive into Mount Olive’s finances and uncovered several concerning issues. Local officials agreed with the findings in our report. Now, it’s time for our recommendations to be put into action.”

Town’s Acknowledgment and Next Steps

In response to the investigation findings, Interim Town Manager Glenn Holland stated that the Town of Mount Olive “takes these allegations seriously” and has accepted all findings and recommendations outlined in the audit report.

The investigation highlights the critical importance of proper oversight and internal controls in municipal government operations, particularly in utility billing systems and contracted services management.