Oxnard Treasurer and Mayoral candidate attacked on CPA license

By George Miller

There has been much political battling in Oxnard, including personal attacks on special election candidates, including plenty of mudslinging.

Controversial and aggressive Oxnard Treasurer Phil Molina has also been attacked, even though he is not running for office. He has challenged various City financial norms he says are unacceptable and some powerful people have taken offense and opposed him. He and his staff have worked hard to clean up the Treasurer’s office and related financial matters. Some disputes have arisen over what responsibilities belong in the Treasurer’s office vs elsewhere. There is also controversy about Molina using very public email blasts to aggressively stake out his positions. He has attempted, with much success,  to raise the level of the Treasurer’s office up from levels which preceded his time in office. But, the pushback has been significant.

Local activist and recall opponent Aaron Greer has been the face behind some recent attacks on Molina on his stated qualifications. He also initiated what appears to be an unjustified attack on Measure M initiator, mayoral candidate and local financial executive Aaron Starr (see CJ’s Starr story).

Molina reportedly won a large settlement for wrongful termination as Finance Director years back by now discredited former City Mgr. Sotello, yet Greer insists he was removed for performance issues.

Greer engaged in a chain of emails attacking Molina’s qualifications and actions in office, which have quite a bit of public support. Here is the most recent email attacking Molina and Starr we saw while writing this article:

—–Original Message—–
From: Aaron Greer <[email protected]>
To: wendy.leung <[email protected]>
Cc: editor <[email protected]>; jvillatnight <[email protected]>; jtsunflower1 <jtsu[email protected]>; talonenterprises <[email protected]>; mglea <[email protected]>; perellobert <[email protected]>; tim.Flynn <[email protected]>; bryan.macdonald <[email protected]>; Carmen.ramirez <[email protected]>; jesus.nava <[email protected]>; jim.throop <[email protected]>; Oscar.madrigal <[email protected]>; scott.whitney <[email protected]>; Stephen.fischer <[email protected]>
Sent: Fri, Mar 30, 2018 12:15 pm
Subject: Phil Molina misconduct complaint

Hi Wendy,

http://www.dca.ca.gov/cba/consumers/lookup.shtml

My big concern about Starr is that he hasn’t been maintaining the required continuing education. He is not allowed to practice public accounting anymore, even though his license is valid through 2020.  Click on the ‘definition’ link next to his inactive status. Laws change often and he has made claims to know government accounting.   Not sure but this may be a factor in all the misinformation he’s been perpetuating over the wastewater rates. He doesn’t know or understand the issues he claims to champion.  My observations are that he’s responsible for the spread a lot of outright false information via his paid signature gatherers who lied to people to get signatures.  He even gave me false information in person in front of a grocery store.  But one thing we do now and that is that at one point he actually did take and pass the test/vetting process to be a CA CPA and with our state requirements, that is a notable achievement.  Unlike the next person I need to discuss…..

The other one that’s even more disturbing is Phil Molina.  He campaigned on his CPA license and qualifications and I was a BIG supporter of this.  He’s represented himself numerous times via official city emails and communications as a CPA.  He is not now nor has he ever been licensed in accordance with CA law to be one here.  He was licensed in Illinois up until 2012 when he expired and has not renewed.  I had to ask him three times before he would admit that he was not a CA licensed CPA.  He kept deflecting me with off-the-topic subjects.  Then he wrote to me via his official city email that he was a currently licensed CPA in Illinois.  That was false and a check of their licensing agency database (see link below)confirmed it was not true.  I confronted him with this and he went on to send me a letter from 2005 involving a court case against him with a private investigator where he was recognized by a private trade organization as a CPA.  He actually believes that this allows him to title himself as a CPA here in CA, even though the B&P Code specifically states otherwise.  When I provided him with the statues for reference and continued to question him, he became upset, accused me of sending false information (the state laws no less) and actually threatened to sue me if I didn’t cease my queries and law references.  That’s not going to work on me.  In fact it does the exact opposite.

I am planning on submitting formal inquiries/complaint against Phil Molina with the CA Board of Accountancy, The Grand Jury and the VC DA’s office.  Interestingly enough, from what I found out, he would not be able to pass the vetting process in CA to become a CPA due to his termination from the City of Oxnard as finance director.  That’s a personnel matter that (correct me if I’m wrong here) technically nobody is supposed to know about but many do, as it was leaked in the past by other former employees.  He tells people that the reason he was ‘ran out’ from his job was because of retaliation for being some kind of whistleblower.  When in fact it appears he was terminated for performance-based reasons; he continued to make expensive mistakes and that would fall under the incompetency clause in the government code.  I really wish this could be made public by the city.

Looking at the bigger picture here, one huge problem I see over and over again in this city is the lack of professional qualifications and experience that causes bad things to happen and expensive mistakes to be made.  Phil routinely sends out city emails through the Oxnard.org server cc’ed to hundreds of Oxnard residents whenever he has a disagreement with the finance department or any other department head.  In those city-wide email blasts, he often makes mistakes, cites incorrect/outdated information and makes baseless accusations of the city staff lying, stealing, incompetency and engaging in other unlawful activities.  I am tired of seeing malignancy like this in our city government.  It is unprofessional, costly, disruptive to the staff workload and plumments morale.  We have an embarrassingly high turnover rate and this is affecting our ability to attract and recruit decent talent. The public needs to know about this so we can correct his behavior and hold him accountable.  I do not work for the city, nor am I beholden to any elected city official or staff.  I am a very concerned resident/ratepayer and involved neighborhood chair, INCO board member.  I volunteer my time for the city and nobody holds any levers over me.

https://ilesonline.idfpr.illinois.gov/DFPR/Lookup/LicenseLookup.aspx

BUSINESS AND PROFESSIONS CODE – BPC

DIVISION 3. PROFESSIONS AND VOCATIONS GENERALLY [5000 – 9998.11]

  ( Heading of Division 3 added by Stats. 1939, Ch. 30. )

CHAPTER 1. Accountants [5000 – 5158]

  ( Chapter 1 repealed and added by Stats. 1945, Ch. 1353. )

ARTICLE 3. Application of Chapter [5050 – 5058.4]

  ( Article 3 heading repealed and added by Stats. 1959, Ch. 310. )

5055.  

Any person who has received from the board a certificate of certified public accountant, or who is authorized to practice public accountancy in this state pursuant to Article 5.1 (commencing with Section 5096), may, subject to Section 5051, be styled and known as a “certified public accountant” and may also use the abbreviation “C.P.A.” No other person, except a firm registered under this chapter, shall assume or use that title, designation, or abbreviation or any other title, designation, sign, card, or device tending to indicate that the person using it is a certified public accountant.

(Amended by Stats. 2015, Ch. 430, Sec. 1. (AB 181) Effective January 1, 2016.)

Aaron Greer

 

Molina has mentioned (And here) that he was a CPA, licensed in Illinois and also a member of a California CPA’s organization, which is not the same thing as being legally recognized as a CPA in CA. Being an active, licensed CPA is required before you can run/oversee an audit. It is not required for his current position as Treasurer or his previous positions as Finance Director in Oxnard and elsewhere. However, the coveted CPA designation comes with bragging rights and helps add credibility. Often, active, practicing CPA’s in public accounting positions, typically auditors, either go to inactive status or let their licenses lapse when they go into management and other non auditing positions.

The Illinois CPA web site indicates that Molina’s Illinois CPA license expired in 2012. He claims he attempted to renew it and thought that was accomplished (see below). We have other evidence supporting that, too. He did originally pass all requirements, did CPA work and has all the experience and qualifications that entails.

It occurred to us that his license expired during a tragic, turbulent period in his life, when his beloved wife was dying of cancer. It would have been a simple matter to keep his CPA license in inactive status by simply paying the fee, 

We were told by retired CPA and CD26 Congressional primary candidate and retired CPA Jeff Burum, of Oxnard, that the CPA exam is a standard, national test and that there is also an ethics test and field experience requirements. He added that an inactive CPA should be so noted and if the state is different than the one being advertised in that should also be noted. Someone with an expired license should describe him/herself as a ‘former CPA, he added. Burum describes himself as a retired CPA, to avoid any misunderstandings. He had his own problems in his CPA practice partnership in Colorado, when it was discovered, previously unbeknownst to him, he said, that his partner’s CPA license was actually in Iowa, which made him ineligible. This left Burum holding the bag as the only CO licensed CPA in the firm, leaving him to take the rap and pay a $1000 fine, with no other penalty, he told us. So, he learned to “trust, but verify.”

 

Email received 3-30-18 from Phil Molina

​George,
 
This is the letter I sent to the Illinois Department of licensing. I found it in brief case, which is why it is a bit crinkled.
 
I don’t know what this will do to prove anything other than that I applied to have my license re activated. I called about a year ago, and was told that it had been reactived, but I did not confirm that by checking the webpage though I did specifically  ask if the webpage would show it activated and was told it would.
 
Also just fyi, I became a licensed Illinois CPA much earlier than 2004. I don’t know at this time if that might be the date the information was put into their computer.
 
Thanks,
 
Phillip Molina
 
 
 
CA CPA info: http://www.dca.ca.gov/cba/consumers/lookup.shtml
IL CPA info: https://www.idfpr.com/licenselookup/results.asp?page=17&pro_cde=0065&lnme=m&initial=&type=NAME&rowcount=200&checkbox=on
 .
But, the bottom line is that he should not calling himself a CPA at this time without the qualifying language stated herein or making sure that the renewal is processed. There may have been a paperwork glitch – that’s still to be determined.
 .
Since Greer’s email also attacked Aaron Starr, I asked Starr for his comments on it and received  the following:
RE:

“My big concern about Starr is that he hasn’t been maintaining the required continuing education. He is not allowed to practice public accounting anymore, even though his license is valid through 2020.  Click on the ‘definition’ link next to his inactive status. Laws change often and he has made claims to know government accounting.”

–Aaron Greer

Most people don’t know what certified public accountants are licensed to do, nor do they understand why the legislature requires continuing education for some – but not all – CPAs. Many imagine CPAs as professionals who prepare tax returns. While that is often the case, that is not the reason the state licenses them. People in the business of public accountancy are licensed to compile financial statement reports and provide audit, review and other services that assure readers of the validity of financial information prepared by others. The license holder knows how to prepare financial statements in accordance with generally accepted accounting principles andaudit financial statements in accordance with generally accepted auditing standards.

Without CPAs, the managers of some organizations might be inclined to issue inaccurate – or even deceptive – financial reports to overstate their performance or solvency. CPAs protect the public by making sure that financial reports are prepared in accordance with recognized standards, that they have sufficient disclosures and that they reflect reality, all of which are particularly important to investors and creditors. I have heard some describe CPAs who audit financial statements as licensed financial reporting watchdogs. That’s not too far off the mark.

Of course, CPAs are not omniscient. Sometimes a company – or even a city government – will present financial information that is false and misleading, and a CPA’s audit will not always discover the misstatement, particularly in the case of an organization with poor internal controls where the manager preparing the report is concealing poor performance or even malfeasance.

Since accounting standards evolve over time to provide better and more relevant information, CPAs who choose to maintain an activelicense to engage in public practice are required by state law to complete qualified continuing education courses in the area of accounting and auditing related to reporting on financial statements. Those of us who graduate from public practice to private industry are inactiveand no longer legally required to do so.

I enjoyed my years of public accounting. If I ever decide to change my license status to active to reenter public practice, the law would require that I resume sitting through 40 hours of continuing education courses each year. But I don’t see myself returning to public accounting anytime soon. Today, I am delighted to be using the skills I developed as a CPA to serve as the financial controller of a world-class manufacturing company right here in Oxnard. My job requires that I continuously educate myself on changes in the law and reporting standards, and I get to work with some amazingly bright, talented people who are committed to making the best machines in the world.

Competent CPAs often develop good instincts for when a report is less than truthful. I still enjoy finding ways to use my skills to benefit the public. Some of you may remember when the City of Oxnard presented a report in late April 2016 to the city council (and the public) on wastewater revenues. Management stated that the wastewater utility was only going to bring in less than $24 million for the fiscal year ending June 2016, even with the latest rate increase, and that this was due to public conservation of water. I knew that a decline of that magnitude was impossible and publicly stated such at the time. Unfortunately, the council fell for this ruse. I was later vindicated when the city’s Comprehensive Annual Financial Report was published showing revenues in excess of $30 million:https://www.movingoxnardforward.org/steering_the_city_council_with_false_information

It seems to me that the Oxnard City Council could use a mayor with my skill set. The current crew often does not seem to know whether the figures being presented to them are even plausible, so they are bound to make expensive mistakes. That is less likely to happen under my watch.

Aaron Starr

Related:

Oxnard mayoral candidate Aaron Starr’s CPA status challenged

Oxnard mayoral candidate Aaron Starr’s CPA status challengedBy George Miller- Recently, multiple people have challenged Oxnard Mayoral candidate and local financial executive Aaron Starr’s right to use the CPA (Certified Public Accountant) title. It doesn’t appear that Starr has been using that title, although others, including even this publication have incorrectly bestowed that title on him. He IS a CPA, but currently […]

 

George Miller is Publisher/Co-Founder of CitizensJournal.us and a “retired” operations management consultant residing in Oxnard.


Get Citizensjournal.us Headlines free  SUBSCRIPTION. Keep us publishing – DONATE

One Response to Oxnard Treasurer and Mayoral candidate attacked on CPA license

  1. Citizen Reporter April 7, 2018 at 2:00 pm

    Received from Phil Molina:

    Friends,​

    Update:

    In August 2016 I sent in a notification and the fees to Illinois Department of Financial and Professional Regulation (IDFPR) to have my CPA license returned to “active” status and I was informed that it was.

    The IDFPR recently added two (2) new rules for an Illinois CPA license to remain in the “active status”: 1. That the CPA licensee have no unpaid child support and, 2. That the CPA licensee has performed audits* resulting in an ‘auditor’s opinion’ in the last year. So yesterday I spoke on the phone with the Administrative Supervisor for the Trusties of the IDFPR, and I explained to her that I have no children of my own, and that I did not conduct an audit* in the last year and being the Elected City Treasurer I do not intend to perform audits* in the coming year. She reminded me that based on my factual responses I elected to have my license status changed from “active” to “inactive” status. The Administrative Supervisor then reminded me to get my license status changed back to “active status” all I need to do is notify the Trustees and pay the fees when I intend to conduct audits*.

    I still continue to be an active member in the California CPA Society, and I have active status in the Illinois Society of CPAs, and I have an active membership in the American Institute of Certified Public Accountants. Changing the CPA license status is both a voluntary act, required by law and not a disciplinary action.
    Thanks for your understanding in this matter.

    Phillip Molina, Member of the California CPA Society

    *The term audit in this case, means a full and complete audit of financial statements, internal controls, and field work leading to an opinion of fairness of the financial statements.

    PROFESSIONS, OCCUPATIONS, AND BUSINESS OPERATIONS
    (225 ILCS 450/) Illinois Public Accounting Act.

    “CPA (inactive)” means a licensed certified public accountant who elects to have the Department place his or her license on inactive status pursuant to Section 17.2 of this Act.

    Reply

Leave a Reply

Your email address will not be published. Required fields are marked *