For the second time this year, Seattle Public Utilities has fired employees for fixing utility bills.

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For the second time this year, Seattle Public Utilities has fired employees for fixing utility bills.

Three employees were fired and a fourth suspended Friday for falsifying payment records, waiving late fees or arranging for extended payment plans, all to benefit themselves or a family member.

The dismissals came as the Seattle Ethics and Elections Commission in an independent investigation found that four current and one former SPU employees had improperly adjusted utility accounts. Four were customer-service representatives who routinely had access to utility and electric bills. The fifth was a civil engineer who also had access to the billing system.

The most serious is that of the engineer, Chau Phan, who left SPU in February after 16 years with the utility. Phan signed a settlement agreement with Wayne Barnett, director of the Ethics and Elections Commission, in which Phan acknowledged that he had fixed his own residential utility account and that of a rental property to record payments of more than $1,000 when none were made.

Barnett is recommending that Phan be fined $1,500. Because he is no longer an SPU employee, he was not subject to disciplinary action.

The Ethics Commission meets Wednesday and may accept the recommendation or impose different sanctions.

The utility fired two employees in January and February for lowering their own bills and said it would launch an investigation in cooperation with the city auditor. At the utility’s request, the Ethics Commission began its own investigation in September. The utility said its investigation is expected to take several more months to complete.

The utility did not release the names of the employees disciplined, so its not certain they are the same ones mentioned in the Ethics Commission report, or which violations which employee is accused of committing.

The state auditor in June completed a routine examination of Seattle Public Utilities billing system that blasted the agency’s oversight. The audit concluded that SPU did not have adequate controls over customer accounts and that as many as 300 employees had access to the combined utility billing system for SPU and Seattle City Light.

The audit also noted that in a 17-month period, July 2009 to November 2010, the utility made 2.4 million adjustments to more than 264,000 accounts.

SPU director Ray Hoffman said that although the dollar amount involved in all the cases is relatively small, the greater issue is employees using their positions for personal gain.

“SPU takes the public’s trust seriously and expects our employees to follow the city’s ethics code. We are committed to a full review of department procedures and have taken strong steps to prevent misconduct,” Hoffman said in a statement.

Among the measures instituted since the billing investigation began last year are enhanced internal controls and monitoring of billing transactions, fewer staff with access to customer accounts, and a requirement that employees sign a confidentiality agreement that includes an ethics statement, said SPU spokesman Andy Ryan.

Ryan said that since the first cases were uncovered, the utility has been reviewing 10 years of department billing data for irregularities.

According to the settlement agreements released Friday by the Ethics Commission, one longtime customer-service account representative repeatedly set up payment programs for her own account that allowed her to defer payments and avoid late fees or collection action.

Between January 2010 and January 2011, the investigation found, the employee created 10 different payment plans using her access to the billing system.

In February 2010, she received a shut-off notice that required her to pay 75 percent of her outstanding balance. The employee paid just 3 percent of the balance and then set up a new payment plan, according to the investigation.

City ethics rules prohibit an employee from participating in a matter in which he or she has a financial interest.

The rules also say that an employee may not use a city position for private benefit. The employee has admitted wrongdoing and agreed to pay a $1,500 fine, subject to approval by the Ethics and Elections Commission.

The other three cases involve account representatives who adjusted their own or a family member’s bill, according to the Ethics Commission findings.

One has agreed to a $700 fine for setting up 16 payment plans over three years that deferred payments to the utility and avoided credit action.

Another has agreed to a $400 fine for creating five payment plans for her own account between August 2010 and February 2011.

A third agreed to a $300 fine for waiving a $5.90 extra garbage fee twice and one $10 late fee, both on her parents’ account.

Lynn Thompson: 206-464-8305 or On Twitter @lthompsontimes.