Investigators have named the late Karen Mulhall as a suspect in the alleged crime.
Mulhall was dismissed as the town clerk earlier this year.
According to the Glenwood Springs Post Independent, Mulhall was found dead in Denver on Oct. 28. The circumstances have yet to be made public.
The investigation began after Alpine Bank contacted the town about financial irregularities in the town's bank account.
(Copyright 2012 by The Associated Press. All Rights Reserved.)