A 22-year veteran of the Vermont State Police who resigned under fire this week was charged Friday with two felony counts of falsifying time sheets by reporting he responded to incidents that a prosecutor said never occurred.

Former Sgt. Jim Deeghan, 49, of Colchester, entered pleas of not guilty through his lawyer in a brief appearance in the criminal division of the Chittenden Superior Court. The judge allowed Deeghan to be released on conditions.

Deeghan answered the charges as a phalanx of senior state police officers lined the back row of the courtroom, with the most senior of them, Col. Thomas L’Esperance, afterward calling it the “most disturbing” case of internal corruption he had seen in 25 years on the force.

“The troopers understand this is about the state police. This is about the public trust. This is about things that we come to work to protect, so no one is walking with their head held real high right now,” L’Esperance said.

Deeghan and his lawyer left the courthouse without talking to reporters.

Last year, Deeghan was paid about $136,000, putting him among the top 10 best paid public employees in the state. That was about $56,000 more than his base pay, though a trooper can typically expect to make about $30,000 in overtime a year.

The investigation was triggered when, in late June, a corporal in the state police’s Williston barracks told a supervisor he had noticed discrepancies in Deeghan’s time sheets when looking through them for an overtime code. On Monday, Deeghan was confronted with the allegations and was suspended; he resigned on Tuesday.

So far, said Chittenden County State’s Attorney T.J. Donovan, detectives have only had time to review Deeghan’s time sheets for two pay periods in June, but he said the investigation is continuing.

“We felt it was important to file a charge as soon as we could; that’s why we’ve only looked at one month. We will go back as long as necessary,” Donovan said

Earlier this week, Gov. Peter Shumlin and other officials said there was no evidence the allegations of time sheet fraud extended beyond Deeghan. But Shumlin said an outside auditor would be brought in to review time-reporting practices throughout the nearly 400-member state police force.

Donovan said the “most egregious” part of Deeghan’s scheme was reporting incidents that never happened, including two car crashes in Colchester and Milton and a false alarm at the Vermont National Guard’s Mountain Warfare Training School in Jericho.

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