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Owen County Deputy Judge-Executive Renaee Gaines could face criminal charges after a standard state audit found she increased her salary by more than $14,000 by “manipulating payroll records.” State auditors found the pay discrepancy after examining several canceled checks from the 2006 and 2007 fiscal years. Auditors determined that Gaines, who oversees payroll in the office, posted part of her increase in salary to the county’s ambulance salary account code for five periods. Four backdated checks issued to the deputy judge-executive were never posted to the quarterly report, according to an audit summary released Monday. Receipts provided by Judge-Executive Billy O’Banion’s office – obtained by a The News-Herald open-records request – confirm Gaines repaid the money through three separate payments from June 30 to July 28. “We have received a referral of this case from the auditor’s office. We are investigating,” said Allison Martin, a spokeswoman for the Kentucky Attorney General’s office. “Because we have an ongoing investigation we cannot comment further about this case.” After reviewing the case Monday, County Attorney Charles E. Carter said he notified Commonwealth Attorney Jim Crawford, whose office immediately began its own investigation. Carter said it will likely involve detectives from the Kentucky State Police. No formal charges have been filed against Gaines as of Tuesday. The audit showed the $14,043 additional payroll Gaines allegedly paid herself increased her salary from $35,000 to just over $49,000. Gaines allegedly received 27 annual paychecks –– instead of 26 –– 11 of which contained a full month’s salary instead of a standard two-week salary, the audit revealed. The audit found the fiscal court lacked oversight and further maintained a “weak internal control structure,” because one individual performed almost all accounting functions. Gaines serves as the county’s primary payroll officer. “The auditor’s office is constantly emphasizing to county officials across the state the need to implement and oversee stronger controls in their offices regarding payroll and county funds,” State Auditor Crit Luallen said. “This audit points out the need for those controls.” O’Banion conducted his own investigation and found no reason to recomend any further action, according to a response filed with the state auditor’s office. O’Banion could not produce a summary of that investigation. “There were no written documents of the internal investigation,” he said. In a prepared statement O’Banion wrote: “ee I have full faith in my deputy judge-executive. Repayment of the overpayment has been made and suggested changes made by the auditor have been implemented.” Those changes involve outsourcing the county’s payroll system to an independent agency. Gaines remains on county payroll and has not been suspended as of Tuesday, O’Banion said. Gaines was employed at a bank before O’Banion appointed her as his deputy in 2001. O’Banion said Gaines declined to comment at this time. The full report is available at www.auditor.ky.gov.