Borough releases report on ‘improprieties,’ outlines worker’s compensation claims, alleged improper payouts
SHENANDOAH – The Borough of Shenandoah released a report this week detailing alleged financial improprieties at borough hall, including releasing information on two employees’ compensation claims.
Borough Council retained Joseph Yanushefsky, Mahanoy City, to conduct a forensic audit of operations prior to the current administration.
Thursday, Borough Manager Mike Cadau released an report dated June 4 from Yanushefsky.
The report alleged that the prior manager, Anthony Sajone, “failed to pay employee withholding taxes” leading to penalties of at least $1,843.27. It claims Sajone was employed as Secretary/Treasurer from April 24, 2020 and terminated on Dec. 31, 2024.
Sajone began working for the borough on April 27, 2020 as borough/supervisor manager.
No vote to terminate Sajone ever took place.
The report also alleges two former employees received workers’ compensation checks and payroll checks concurrently, with one receiving payroll checks after resigning.
It names the two employees and includes documents pertaining to the workers compensation claims, including a Compromise and Release Agreement by Stipulation for one employee. That document includes the injury the employee received and what compensation he would receive moving forward.
Those two employees also allegedly received compensatory time while on workers’ compensation and Sajone had also been paid compensatory time, though he was an exempt employee.
It also outlines a life insurance issue which Cadau detailed in February, shortly after being hired. The report, naming a deceased employee, outlines a situation that arose when life insurance for the borough’s retired employee lapsed. Sajone used borough general funds to pay out the policy “without prior knowledge or approval from Borough Council.”
In total, the report alleges $241,833.35 in damages to the borough. Yanushefsky writes that he is evaluating other situations which may have resulted in the misuse of taxpayer funds.
Cadau, in a release, says the borough is also auditing the sewer authority and the sale of the Municipal Authority of the Borough of Shenandoah.
Each investigative report, he says, have been submitted to the Attorney General’s Office and IRS Criminal Investigation Division and a claim has been submitted to the borough’s bond insurer.
“The Borough aims to ensure that taxpayers, residents, and community stakeholders are fully informed about actions being taken, irregularities discovered, and next steps toward restoring trust and operational integrity,” Cadau writes.
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