The former recorder/treasurer for the City of Lead Hill, 66-year-old Mary Katherine “Kaye” Farrar, has been arrested and charged with felony counts of abuse of an office and theft of property. Farrar also faces a misdemeanor charge of falsifying business records. The charges stem from her allegedly writing off family water bills.
According to the probable cause affidavit filed Friday, Farrar’s arrest follows an investigation by the Arkansas State Police at the request of 14th Judicial District Prosecuting Attorney David Ethredge of Mountain Home.
With the assistance of the Arkansas Legislative Audit, a special audit was performed on the city’s water department for the years of 2014 to 2018.
During this time, Farrar served as the city’s recorder/treasure, while her brother-in-law, Michael Farrar, was the city’s water superintendent.
The investigation revealed Kaye Farrar made several adjustments to her water account during the four-year period totaling more than $1,800. She made a payment to the account in Dec. 2012, while not making any further ones until July 2015.
She allegedly began making payments again in Jan. 2018 on a regular basis. The action followed questions about the lack of payments.
The audit also found for almost four years, no adjustments, no penalties and no charges for water were found on the account of Kaye Farrar’s husband. However, water usage was logged during this period. The adjustments totaled more than $1,800.
In addition, for over three years, the couple’s daughter and son-in-law allegedly made only one water payment. These adjustments allegedly made by Kaye Farrar totaled over $1,900.
It was also discovered through the audit Michael Farrar was terminated from the City of Lead Hill, but was issued two checks for compensatory and vacation time, in violation of the municipality’s policy. Kaye Farrar computed the time allegedly owed to her brother-in-law. The checks contain her signature, as well as that of former Mayor Joe Inman.
In an interview, Kaye Farrar reportedly said she took the illegal actions because her family was in financial distress.
Her bond was set at $1,000.