UPDATED: Former Niantic fire chief arrested on larceny charges

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East Lyme — The former Niantic fire chief turned himself in to East Lyme police Wednesday, nearly three months after he resigned amid allegations he misused town funds by collecting money for shifts he did not work.

Stephen M. Wargo, 47, of 59 East Pattagansett Road, Niantic, was charged Wednesday with first-degree larceny. He was processed and released on a $1,000 nonsurety bond and is due March 27 in New London Superior Court.

The severity of his charge is based on the fact that he is accused of stealing from a municipality.

East Lyme police said Wednesday they issued a warrant for Wargo's arrest after concluding a nearly three-month investigation. The allegations came to light in December after 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.

Wargo, who was a volunteer chief and a paid part-time firefighter at the Niantic department, submitted his resignation as chief for what he called "personal reasons" in December. He is also a lieutenant in the New London Fire Department. Pursuant to a city personnel policy, he is suspended pending disposition of the criminal case, Mayor Michael Passero said.

According to the arrest warrant, Wargo stole $2,397.53 in varying increments over a 17-month period beginning in Jan. 2017. He did so by allegedly submitting time sheets claiming hours he had not actually worked, such as shifts he originally was supposed to work but for which he had found substitutes, being paid excess hours documented for a scheduled shift, and shifts for which he was never scheduled.

As fire chief, Wargo was responsible for submitting each week's time sheets for his department. 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.

According to the arrest warrant, Wargo was always aware that he was submitting inaccurate time sheets. He stated that on some occasions that was done accidentally, such as when he was scheduled to work a part-time shift but then worked overtime at his other full-time job. But he also admitted that on other occasions he was "sloppy" and "failed to remove himself from the time sheet."

He further stated that both personally and professionally, he was "burning the candle at both ends." As a divorced father paying child support, he was under pressure and "the extra money helped," he told police.

Since resigning, Wargo has paid $2,100.96 back to the town.

The matter first arose, according to the warrant, when firefighter Mike Nebelung approached then-Niantic Deputy Chief John Dwire, who is now chief, about a payroll issue related to his part-time hours in August. When the two started looking into payroll records, they noticed discrepancies for part-time firefighters. Upon further analysis throughout September, Dwire discovered, with the help of Assistant Fire Chief Jim Barone, that the issues were related to Wargo's time sheets.

In December, Dwire and Nebelung confronted Wargo about the time sheets, telling him that he needed to step down and that it was his last shift. When the two asked Wargo if he knew he was being overpaid for his shifts, Wargo replied, "Yes, I knew I was getting overpaid," the warrant said.

Wargo explained his actions by saying, "I needed the money," after also explaining that he had bills to pay and that his ex-wife was ill.

On Dec. 19, Wargo told First Selectman Mark Nickerson he was resigning as fire chief for personal reasons. On Dec. 22, Nickerson contacted police Chief Mike Finkelstein to initiate a police investigation into Wargo's time sheet discrepancies.

Obtaining payroll records from Finance Director Anna Johnson, Finkelstein started conducting that investigation Dec. 27. Johnson reported that Wargo had received $22.77 an hour since July 1 and previously received $21.78 from July 1, 2016, through June 30, 2017, and $22.32 per hour from July 1, 2017, through June 30, 2018.

Nickerson declined to comment Wednesday.

Nickerson said in December that the town was in an ongoing review of policies and procedures on payroll submissions from all fire departments, and that the Niantic Fire Department, under then-acting Chief Dwire, was using a more stringent timecard and payroll verification system.

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

New London Fire Chief Tom Curcio declined to comment Wednesday.

Day Staff Writer Greg Smith contributed to this report.

m.biekert@theday.com

Editor's Note: This article corrects the date Stephen M. Wargo is scheduled to appear in court.

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