An independent special audit shows McKinley County made about $240,000 in questionable payments to a business owned by the county commission chairman.
State Auditor Hector Balderas released the finding of the audit Monday. His office says the county violated the state procurement code and its own purchasing policies.
Balderas' office also says there are potential violations of the Governmental Conduct Act related to the county's contracts for plumbing, heating, air conditioning and other services with Dallago Corp. The company is owned by Chairman David Dallago.
Balderas' office designated the county for a special audit in May after allegations of questionable procurement activity were reported via the auditor's fraud hotline.
Balderas says he will refer the report to the district attorney, the attorney general's office and other state law enforcement agencies.