EXCLUSIVE: Former NFAT director comments on theft charges before his eventual arrest in Texas
NORFOLK, Neb. – A former northeast Nebraska transit director accused of embezzling hundreds of thousands of dollars turned himself in at the border of Texas and Mexico Friday morning.
Former North Fork Area Transit Director Jeffrey Stewart was arrested at approximately 9:30 a.m. on theft charges in Brownsville, Texas, it was confirmed by a Madison County deputy on scene.
Stewart has been the subject of a Madison County felony warrant for theft as a result of an investigation by the Madison County Sheriff's Office, during which he was accused of embezzling between $750,000 and $1 million from the transit service. Stewart is accused of embezzling money for flights, purchases at casinos, meals at area restaurants, home goods and more, all for personal use, according to investigators.
The sheriff’s office mistakenly sent a press release indicating Stewart had been arrested on Thursday before advising that Stewart was not yet in custody.
In a 59-minute phone call from Mexico a day prior to his arrest, Stewart told News Channel Nebraska that he planned to turn himself into authorities Friday morning, at which point he said he would be transported to northeast Nebraska. He said Thursday he anticipated being in Madison County by Friday night. The Madison County Sheriff’s Office confirmed Friday morning that that was the expected timeline after his arrest.
“I am surrendering,” Stewart said via phone on Thursday. “So we can start off with laying out the facts that they’re not going to turn around and spin it as, you know, that they cornered me somewhere and that I’ve been running because that’s not the case. I haven’t been running from anything.”
Stewart said he was calling from his wife’s cell phone in Mexico, where he claimed she is originally from.
Stewart said his wife and his children remain in the United States. He said he had not seen them in at least two to three months.
He said the phone number used to call News Channel Nebraska was the same one used to arrange his surrender with the Madison County Sheriff’s Office, though the Madison County Sheriff's Office could not confirm that phone number's use in conversations with law enforcement.
“I finally decided enough is enough,” Stewart said. “I’ve never been running from the Madison County Sheriff. I did not come in contact with them until recently, about two weeks ago, at which point I had been working with them to arrange turning myself in to get this matter resolved.”
Stewart said he had originally planned on surrendering July 6, citing logistical issues on the Madison County Sheriff’s Office as the reason the date was pushed back to July 14.
Stewart said he left Norfolk at the end of last year while dealing with a mental health crisis, noting that he intended to take a leave of absence from his job at North Fork Area Transit due to personal issues.
“I took a leave of absence in December, in writing, to take care of some person health issues. That’s why I was gone when all of this went down,” Stewart said. “The bottom line is my employer was aware that I was going to be stepping away in December to take care of some personal medical issues. Essentially, I had a mental breakdown.”
North Fork Area Transit was unable to make payroll on Dec. 16, requiring the organization to seek $88,155.59 from the Norfolk City Council.
Stewart said the funds that had been reported missing from North Fork Area Transit had to do with longer wait times for reimbursement from the Nebraska Department of Transportation.
Stewart claimed that after an audit review of NDOT’s invoicing process for transit agencies, reimbursement began to take much longer. He said that coincided with the transit agency’s growth, leading to a shortage of cash on hand.
“So basically what happens at that point, whereas normally you would submit a reimbursement request the first of the month and you would be paid for that previous month by the 15th of the following month, delays started beginning to where they would go three and four months without receiving a dollar back from the Nebraska Department of Transportation, pending their backlog," Stewart said. "Now it’s been brought up that there was $750,000 given from the county. Where did that money go? Well, it’s real easy to account for because with the purchase of vehicles, the acquisition of vehicles, we went from nine buses up to 34 vehicles. Now I don’t quite understand how it is that complicated to understand.”
Among the documents filed in Madison County as part of Stewart’s case are bank statements with alleged purchases made by Stewart, including a series of 13 purchases at two different casinos over a five-day period in April of 2022. Those alleged purchases totaled $28,739.93.
When asked about those specific purchases, Stewart said he would like to speak to the county attorney and see the alleged charges line-by-line before commenting. When asked if he had ever made purchases with his company card at the Hard Rock Casino or Prairie Flower Casino, Stewart stated that he had made “authorized” transactions at those locations.
“Authorized transactions are any transaction that are previously approved or transactions that fit underneath a certain threshold,” Stewart said. “Any transit agency in the United States has what they call entertainment line items, which would be if we have a potential client selling us vehicles or if we have a specific vendor selling us hardware or equipment, to take them out to dinner or to pay for their hotel for when they come into town is perfectly a normal practice in our line of work.”
Stewart said employees under his purview also used the card with his name on it, but he would not comment on whether or not believed anyone else may have potentially made fraudulent purchases with the card.
Stewart said before departing North Fork Area Transit that he had sought an internal audit from Steve Rames, who serves on the board of NFAT and also serves as Norfolk city engineer.
When asked if Stewart’s account that an internal review showed the finances were clear before his departure, Rames declined to comment, noting that the case remained an active investigation.
“All the details will come out through the judicial system,” Rames said.