Audit Sparks Investigation Into Former Montana School Clerk Accused of Misusing Over $13,000

The former clerk and business manager for Hot Springs School District 14-J, Carmen Jackson, is under investigation after an audit found she allegedly misused more than $13,000 in district funds. Jackson has since resigned from her position, and the district’s board has voted unanimously to refer the matter to law enforcement.

Audit Findings Detail Misused Funds

According to the audit, which reviewed the 2024–2025 fiscal year, Jackson allegedly received unauthorized payroll advances, issued herself extra stipends, and used a school district credit card for personal purchases. The total amount misappropriated was reported to exceed $13,500.

Community Concerns Lead to Independent Audit and Investigation

The investigation began in June 2025, when a community member raised concerns about potential financial irregularities. The board subsequently hired an independent auditor, who conducted a detailed review of district accounts and found evidence of financial misconduct.

READ MORE: Backcountry MT Flight Turns Fatal for Father and Two Daughters 

School Board Takes Action and Refers Case to Law Enforcement

Following the audit, the Hot Springs School District Board of Trustees voted unanimously to hand the findings over to law enforcement for further investigation. Jackson resigned from her position, and the board has appointed Barkley Flynn as her replacement.

Audit Reveals Gaps in Oversight and Prompts New Safeguards

The audit also identified systemic weaknesses in the district’s financial oversight. Jackson had managed payroll, accounts payable, and the district budget without direct supervision. In response, the board has implemented new safeguards, including requiring the superintendent to review federal purchases over $250 and restructuring roles and meetings to increase accountability.

Community Watchdog Group Raises Concerns Over District’s Response

Community members have expressed concern over how the district handled the issue. Kevin Hein, a taxpayer and resident of the district, said a local Watchdog group has formed to monitor district governance and financial transparency. The group has voiced frustration over what they describe as delays and limited communication from district leaders.

Residents Frustrated by Delays and Lack of Official Support

Hein said residents were told the investigation was referred to law enforcement after 100 days of review, but that the formal letter to transfer the case had not yet been sent as of last week. He also noted that residents feel they have received little support from county or state officials in their efforts to ensure accountability.

Get our free mobile app

District Pledges Cooperation as Investigation Continues

Despite community frustration, district officials say they are committed to cooperating fully with the ongoing investigation and improving oversight procedures. The case remains active, and no charges have been filed at this time.