East Lyme — The Niantic fire chief has resigned amid allegations he misused town funds by collecting money for shifts he did not work.

Steve Wargo, who is a volunteer chief and a paid part-time firefighter at the Niantic department, submitted his resignation as chief for what he called "personal reasons" on Wednesday. He is also a lieutenant in the New London Fire Department, where he remains on the job.

East Lyme First Selectman Mark Nickerson said he removed Wargo from the part-time schedule at the Niantic Fire Department on Friday after allegations came to light that discrepancies of timecards and submitted payroll requests had been discovered by volunteer members of the department. Niantic uses a mix of paid staff and volunteers.

The alleged discrepancies were revealed during an internal investigation by fire department members.

On Friday, Nickerson said he requested the East Lyme Police Department begin an investigation into the claims and expects a forensic audit to be conducted. Nickerson declined further comment by phone because of the pending police investigation but released a statement on Saturday explaining the situation.

“It was discovered that in the case of Mr. Wargo, various part-time shifts were allegedly paid that had not been worked,” Nickerson said in the statement. “Members of the fire department had a conversation with me on Thursday afternoon and brought the paperwork of the initial discovery to my office on Friday morning. Immediately, we removed Mr. Wargo from our part-time schedule pending the results of the investigation.”

Nickerson declined to discuss how much money was involved in the allegation.

The fire chiefs in both Niantic and Flanders fire departments are volunteers and elected by members of their respective fire companies. The chief ultimately is responsible for scheduling, training, recruiting, payroll, budgeting and capital planning.

In coordination with the town’s finance director, Nickerson said there is an ongoing review of policies and procedures on payroll submissions from all fire departments.

“Whenever possible, best business practices should be implemented that would include multiple signature approvals and back-up documents,” Nickerson said in the statement.

The Niantic Fire Department, under acting Chief John Dwire, already has begun using a more stringent timecard and payroll verification system, Nickerson said.

New London Fire Chief Tom Curcio said he only learned of the allegations on Saturday and declined comment.

g.smith@theday.com