A year-long investigation by the New York state comptroller’s office and state police culminated last week in the arrest of the mayor of the village of Candor, Eric Halstead, on corruption and larceny charges.
Halstead was the mayor of Candor in Tioga County for 12 years. He is accused of stealing over $23,500 from the village general fund, and resigned shortly after the arrest.
Nelson Sheingold, chief legal officer for the state comptroller's office, heads the New York state comptroller’s Division of Investigations. Sheingold said in the spring of 2023, the comptroller’s office was contacted by an accounting firm Candor had hired to do its annual financial reports. The firm said they’d noticed strange withdrawals from the village fund.
The comptroller’s office began investigating and found Halstead had allegedly made at least 77 withdrawals from the fund over five years, starting in 2017. Sheingold said village officials, at the mayor’s direction, recorded the withdrawals as "mayor’s discretionary".
“I've been doing this nearly 30 years. That's a novel one to me,” Sheingold said. "Which once again begs the concept, the absurd concept I would say, of why the mayor has a debit card for the village general fund to begin with.”
Cases of corruption in local government are sometimes uncovered by regular audits by the comptroller’s office. That’s what happened last year, when the former clerk-treasurer of the village of Addison in Steuben County was charged with stealing over $1 million from the village funds.
In Halstead’s case, the withdrawals were flagged by an outside accounting firm, though the comptroller’s office did an audit of the village of Candor back in 2017. The audit found the village was not properly managing its general fund. Candor had an excess of money in the fund balance, and no long-term plans on how to spend it.
“The mayor stated he prefers to maintain a fund balance of $100,000 and may use the excessive fund balance to fund the village’s future capital needs,” state auditors wrote. “However, without established capital reserves, the funds may not be used as intended.”
The audit concluded that as a result, the village of Candor may have kept real property taxes higher than necessary. The report recommended the village reduce the amount in the general fund and use the excess money to benefit residents. It also recommended the village develop more comprehensive policies to maintaining the fund balance.
Auditors examined Candor’s general fund from June 2015 to May 2017.
By February 2017, Halstead had allegedly already begun withdrawing money from the fund.
But the comptroller’s office said because the goal of the audit was to focus on the village’s overall management of the fund, auditors did not examine or flag specific withdrawals. The office also said Halstead only made two ATM withdrawals while auditors were conducting field work.
Sheingold said he is constrained from sharing some details about the ongoing case. But in general, he said local governments, no matter how small, should always have clear checks and balances to prevent corruption.
He said the mayor never should have had a debit card with access to the village general fund.
“You can have a great system, it's got to be enforced. So you need the board members to say, okay, we want to look at the ledger. We want to look at this. We want to have this kind of oversight,” Sheingold said. “One person cannot have unilateral control over expenditures.”
Sheingold said Halstead appears to have returned more than $19,300 over the years.
Halstead is facing felony larceny and corruption charges. He’s due back in Candor Town Court on August 5.
The village of Candor and the Tioga County district attorney’s office did not respond to requests for comment.
