A former budget officer in New York's exclusive Hamptons area has been accused of lying to Wall Street about his town's fiscal health.
Prosecutors say Hults made false statements in a bond offering. He also is accused of improperly transferring money between town accounts.
His attorney didn't immediately comment.
The town is the summer home to some of the world's wealthiest business leaders and celebrities. But it has struggled with budget deficits in recent years and now faces a shortfall of as much as $15 million
He said Hults intentionally moved the money from December 2006 and into 2007 to pay other town bills. He did so without the knowledge of the town board and contrary to instructions from the town attorney it was illegal, Spota said.
"These illegal transfers were made to hide from the taxpayers and voters the horrendous fiscal condition of town finances," Spota said. Deficits have reached as high as $15 million in the town, and a state audit is underway.
Hults' actions were done in consultation with town Supervisor William McGintee, Spota said. No charges have been filed against McGintee, but an investigation continues and Hults is cooperating, Spota said.
He declined to characterize McGintee's level of cooperation, and an assistant in McGintee's office said he would have no comment.