Last Updated on August 20, 2026 12:17 pm
An investigative report released by the North Carolina Office of the State Auditor has identified a series of financial management failures in the Town of Newland, including hundreds of thousands of dollars paid to an unlicensed contractor and a sealed-bid sale involving a company tied to the town’s then-sitting mayor.
Delinquent Audits and Unbonded Finance Officer
The report found that Newland had fallen behind on its state-mandated annual audits, landing the town on the Local Government Commission’s (LGC) Unit Assistance List, which flags local governments with significant financial or governance concerns. Investigators also found that the town’s finance officer was not properly bonded, as required under North Carolina law, leaving the town without the insurance protection that bonding is meant to provide against loss from employee misconduct.
$418,658 Paid to Unlicensed Contractor Despite Stop-Work Order
The most significant finding centers on the Roby Shoemaker Wetlands and Family Recreation Park project. Auditors determined the town paid $418,658 to a contractor who was not properly licensed to perform the work. The state issued a stop-work order on the project, but auditors found the town continued making payments to the unlicensed contractor regardless.
$63,460 Mowing Contract Tied to Then-Mayor’s Dissolved Company
Investigators also flagged a Town mowing contract that financially benefited Caretaker Services Inc. (CTS), a dissolved company associated with Newland’s then-sitting mayor. The report found the mayor acknowledged during board meetings that he would personally benefit if CTS won the bid. In 2022, the Board awarded the contract to a different bidder, but in 2024 CTS won on a lowest-bid basis, and the Town paid CTS $63,460 over the following year. The auditor’s report notes the mayor appears to have been statutorily shielded from North Carolina’s conflict-of-interest law under a “small jurisdiction” exception, though his continued use of a dissolved corporation for town business still exposed Newland to legal and financial risk.
$15,210 Wire Transfer Never Recovered
The report also documents a $15,210 loss from a spoofed wire transfer — a scam in which fraudsters impersonate a legitimate payee to redirect funds — that the town has not recovered.
Town’s Response
In its official response included in the report, the Town of Newland acknowledged the findings and outlined steps toward addressing the auditor’s concerns, including work toward bringing its audits current and improving financial oversight and controls.
The full report is available from the North Carolina Office of the State Auditor.
