Tag Archives: audits

Auditors find financial, food troubles at TRICOR

Auditors found financial mismanagement and problems with prison food in a review of the agency that runs inmate work activities, reports The Tennessean.

The Tennessee Comptroller’s 84-page audit outlines months of problems between the Tennessee Rehabilitative Initiative in Correction Board (TRICOR) and the Tennessee Department of Correction (TDOC), including allegations TRICOR staff tried to mislead its board about the agency’s finances. Documents obtained by the auditors also allude to concerns with both the size and healthiness of meals served in prison.

Those concerns mirror complaints received by The Tennessean from inmates and their families. TRICOR notes the state aimed to save money through “portion control.” While TRICOR depicts the change in meal portions as a benefit, it also notes that officers who eat prison meals don’t follow the same portion control guidelines created for inmates. The agency also acknowledges there’s a chance for “prison unrest” because of a “drastic change in the food service program.”

…”As noted throughout this finding and the audit report, we have identified numerous errors and misstatements in TRICOR’s fiscal operations and financial reporting process. Based on the results of our work and in-part corroboration of the allegations, we have serious concerns about whether TRICOR’s management has the ability to report accurate financial information,” the audit states.

TRICOR denies any intentional wrongdoing, but acknowledges it dismissed two officers charged with financial management who were not doing a good job.

“We concur that the previous chief financial officer (CFO) and controller were not performing their duties and overseeing their responsibilities to a satisfactory level,” the agency wrote in response to the audit, noting both people were dismissed earlier this year.

“Once management became aware that problems existed in their performance they acted swiftly to correct the problem.”

…The TRICOR agency is a state inmate rehabilitation service that’s independent from the department. The board relies almost exclusively on inmate labor to provide products such as manufactured flooring, license plates and meals. In turn the department relies on the board to provide the millions of meals it serves to inmates through something called the Tennessee Cook Chill program. Meals prepared by inmates in Nashville can be chilled and shipped to prisons or other customers across the country.

Note: The full audit is HERE.

Audit finds delays in disciplining doctors

The Tennessee Board of Medical Examiners is taking too long to investigate misconduct charges brought against doctors, subjecting patients to “potentially harmful medical practices,” according to an audit by the state comptroller’s office. In reviewing a sample of 21 cases, auditors found 10 were not completed within the time frame set by state rules.

From a Tennessean article on the audit:

The audit also found the board, which consists of nine physicians and three health care consumers appointed by the governor, has not taken steps to comply with a 1979 state law requiring it to collect information from state courts that would alert it to a physician who has been convicted of a crime.

“Citizens expect state medical boards to protect them against unethical practitioners, though occasionally physicians have committed serious crimes that went undetected for years,” the audit noted.

The Tennessee Department of Health will examine each of the cases highlighted in the audit, according to Michelle Long, assistant commissioner for health and licensure regulation.

“The BME (Board of Medical Examiners) and the Office of Investigations take very seriously their responsibility to protect the health and welfare of Tennesseans, and are committed to working more effectively to track and monitor complaints against medical doctors while those complaints are under investigation,” she said.

Audit finds problems in State Museum operations

The state Comptroller’s Office found a series of problems in operations of the Tennessee State Museum in an audit released today, ranging from questionable hiring practices to not keeping track of alcoholic beverages kept at the museum.

“The Tennessee State Museum is empowered to preserve and exhibit some of Tennessee’s most important historical artifacts,” said Comptroller Justin P. Wilson in a press release accompanying the audit. “It is vital that the museum correct problems and follow its procedures to ensure the integrity of its operations and collections.”

Mary Skinner, a spokeswoman for the museum, downplayed the audit results.

“All of the findings point out strengths and weaknesses of the organization’s paperwork, policies and procedures or protocols, all of which we believe to be helpful in providing additional checks and balances for operational implementation,” Skinner said. “We have addressed all of the audit’s findings under which we have control.”

The audit comes amid a controversy over whether the museum’s longtime executive director, Lois Riggins-Ezzell, should be replaced while efforts are underway to raise more than $40 million in private donations to go with $120 million in taxpayer funds allocated to building a new museum, scheduled for completion in December 2018. The audit includes at least one finding that may indicate the need for a new museum: There has been water damage to artifacts stored at the present museum.
Continue reading

Memphis group wants state review of city finance

About 20 Memphis residents asked state officials Friday to look into their city’s finances and examine their complaints of possible ethics violations, reports the Commercial Appeal.

Led by Memphis mayoral candidate Mike Williams, who is on leave as president of the Memphis Police Association, the group boarded a charter bus early Friday, rode to the state capital and met with various state officials to ask them to conduct a “forensic audit” of the city’s books and an ethics review of city officials. Williams said the group also planned to take their requests to federal officials, including the U.S. Department of Justice.

The group did not accuse any city officials of misconduct by name. Several of the residents said they began monitoring the City Council and asking for financial information after the city began trimming city employee benefits to deal with serious budgetary issues, including an underfunded city pension program.

“We’re coming to you as our state representatives and saying ‘Please help’ because we can’t go to our city officials and ask for help. We’ve been doing that for a year now and haven’t gotten anywhere,” said Memphis resident Carol Carlson.

State Comptroller Justin P. Wilson discussed the group’s concerns and pledged to review a thick set of documents Williams gave him. But he said some of the concerns they raised, including the tax breaks the city gives to industries as incentives to create jobs, are political issues that are beyond his authority unless state laws are violated.

“We will take this very seriously, I assure you. But I will tell you there are some issues that are inherently political issues — not issues we have the authority to act on,” the state’s chief auditor said. Asked specifically about the tax breaks, called payments in lieu of taxes (PILOTs), he said, “We can see whether it violates statutes, not whether a PILOT is a good idea” because PILOTs are authorized by state law.

Audit finds problem in keeping guns from those with mental health issues

An audit of the Administrative Office of the Courts finds several shortcomings in operation of the state’s court system, including failure to “fully comply with state statutes designed to keep firearms out of the hands of individuals with mental health issues.”

As Richard Locker notes, the audit recommends that the AOC and county clerks take steps to remedy the problem and keep better track of records on those with reported mental health problems, who cannot legally buy guns.

Tennessee law requires that court clerks submit reports to the FBI’s National Instant Criminal Background Check System (NICS) database, within three business days, whenever a court of law commits an individual to a mental institution or adjudicates him or her as a “mental defective,” whose definition in state law includes a determination that the person is a danger to themselves or to others.

The audit says gun dealers and the Tennessee Department of Safety and Homeland Security must check the NICS database before making eligibility determinations involving firearms. “Therefore, without a complete and accurate database, individuals with mental health issues may still be able to obtain a firearm from a gun dealer” or a carry permit from the state.”

The AOC concurred with the findings and said the problem is “partly due to a funding issue.” It said that in the short term, it will devote the resources necessary to more accurately track the submission of mental health reports. For the long term, it will seek federal grants to improve the process or ask for more state funding.

Other audit findings:

-There has been inconsistency in applying the rules and laws involving Tennessee’s indigent defense system for providing legal counsel to the poor, “increasing the risk of unequal application of the law.”

-Because the AOC was “unable to develop appropriate civil and criminal caseload data collection procedures” for General Sessions Courts, “court clerks made incomplete and inaccurate submissions… in violation of state statute.”

-The Appellate Court Clerk’s office in Nashville has not “appropriately segregated duties: for dealing with cash receipts.

There’s also a list of “observations” – one being that the Governor’s Commission for Judicial Appointments “did not fully document potential conflicts of interest disclosed by commission members.”

‘Extremely troubling’ audit: $732K misspent in feeding hungry children

Tennessee Department of Human Services officials signed off on more than $732,000 in questionable payments to ABC Nutrition Services during a five-year period, reports The Tennessean. The nonprofit agency, operated by Vivian Parker and her two daughters, operates a food program in rural West Tennessee intended to feed hungry children.

Parker’s salary plus bonus topped $100,000 last year. She was also reimbursed for the cost of remodeling her home office in Camden, adding a new deck and widening her driveway. Thousands more were spent on other perks: meals, hotel movies, late credit card fees and cable and internet services.

…That agency wasn’t the only one with questionable billing records discovered in the Department of Human Services-administered food programs responsible for stewarding the expenditures of close to $80 million to feed needy children and some adults.

Auditors with the state Comptroller’s office found that some state contractors billed for double the meals they were authorized to provide, failed to file proper paperwork, mysteriously lost paperwork when auditors arrived to inspect them, failed to ensure qualified children received meals and incorrectly calculated administrative expenses owed to them. All of those billing issues added up to $1.8 million in questionable payments last year in just the small sample of agencies auditors reviewed. In 2013, the questioned costs reached $4.3 million.

In some cases, children who were supposed to be fed may not ever have received a meal.

“DHS management had not ensured that critical controls and effective practices were in place and operating as needed,” the audit found. A lack of oversight “threatens the integrity of the programs.”

“The results of this investigation are extremely troubling,” Comptroller Justin Wilson said more pointedly about the failure by DHS to adequately monitor ABC Nutrition Services, which is located 90 miles west of Nashville in Benton County — a region where more than one in four children live in poverty.

“Hundreds of thousands of taxpayer dollars have been misspent by this organization over a five-year period,” Wilson said. “This underscores the importance of effective program monitoring and oversight.”

It is a finding that DHS officials strongly disagree with, even as they acknowledge that fraud and abuse remain a major challenge in the two federal food programs they oversee.

TN auditors get accountability award

NASHVILLE, Tenn. (AP) – The state comptroller’s audit division has won the 2015 excellence in accountability award from the National State Auditors Association.

The award from the national group recognizes the Division of State Audit’s efforts to improve communication between auditors and state agencies. The division’s “Guide to State Audits,” which is distributed to agencies at the start of every audit, was recognized as the group’s special project of the year.

The auditors association presented the award to Tennessee Comptroller Justin P. Wilson and State Audit Director Deborah Loveless at the group’s annual conference in Little Rock, Arkansas, late last week.

Wilson said in a release that he is proud of his staff for winning the award. In Wilson’s words: “Audits are critical to effective government

Audit finds $732K in ‘unauthorized disbursements’ by non-profit handling DHS funds

News release from state comptroller’s office:
An investigation by the Tennessee Comptroller’s Office has revealed serious concerns related to ABC Nutrition Program, Inc. (ABC) in Camden, Tennessee. ABC is a non-profit organization that administers federal grant funds received from the Tennessee Department of Human Services (DHS) for the Child and Adult Care Food Program on behalf of 216 daycare homes and 120 daycare centers in Tennessee.

Comptroller investigators found that ABC had unauthorized disbursements of $732,702.91 between October 2008 and September 2014. Of that amount, $605,978.69 was used to provide bonuses and extra pay to the managers and employees of ABC. ABC is led by Chief Executive Officer Vivian Parker, and her daughters, Director of Daycare Centers Lisa Carter, and Director of Daycare Homes Tracy Coady.

Investigators also found $27,185.56 was spent on unauthorized construction and improvements to Vivian Parker’s home. The offices for ABC are located in the basement of Parker’s home. Additional unauthorized administrative disbursements totaled $99,538.66 for fiscal year 2014. None of these expenses were approved by DHS.

On February 19, 2015 the Benton County Grand Jury indicted Vivian Parker, Lisa Carter and Tracy Coady on one count of theft of property over $250,000, and one count of theft of property over $60,000.

Comptroller investigators also raised concerns about ABC’s purchasing procedures, travel policies and management oversight. Additionally, investigators noted several of the problems resulted from a lack of oversight by DHS.

“The results of this investigation are extremely troubling,” said Comptroller Justin P. Wilson. “Hundreds of thousands of taxpayer dollars have been misspent by this organization over a five year period. This underscores the importance of effective program monitoring and oversight.”

To view the investigation online, go to: http://www.comptroller.tn.gov/ia/

Comptroller audit: PTO president steals $10,465

News release from state comptroller’s office:
A special investigation by the Tennessee Comptroller of the Treasury has found that Tara Scott, the former president of the Hilham Elementary School Parent-Teacher Organization, stole at least $10,465 from the PTO. This investigation was completed in conjunction with the Tennessee Bureau of Investigation.

During the period August 2012 through February 2014, Tara Scott failed to deposit concession cash collections totaling $5,520. The money was collected during volleyball and basketball games.

Ms. Scott told investigators she took collections home with her and placed them in a locked cash box under her bed. Ms. Scott said each time she retrieved the cash box in preparation for the next game, she noticed the box was empty. Ms. Scott claims the money was stolen again and again over a period of nearly two years. Tara Scott never alerted anyone to the missing funds, and she did not stop the repeated thefts.

Investigators also discovered that Tara Scott wrote PTO checks totaling $4,945 payable to herself or to “cash.” Ms. Scott admitted she used the proceeds for her personal benefit.

On February 2, 2015, Tara Scott and her husband, Lonnie Scott, were each indicted by the Overton County Grand Jury on one count of theft over $10,000.

“Parents play a vital role in their child’s education, and I commend honest parents who volunteer in Tennessee school groups,” said Comptroller Justin P. Wilson. “Unfortunately, there are people who will use their positions to steal money. Simple checks and balances can help prevent theft.”

To view the special investigation report online, go to: http://www.comptroller.tn.gov/ia/.

Audit reveals missing money in Hardeman County account

News release from state comptroller’s office:
An investigation by the Tennessee Comptroller’s Office has revealed a cash shortage of at least $3,062.72 in the Hardeman County Solid Waste Department.

Investigators found that a former employee failed to deposit the money she collected for solid waste fees. The former employee adjusted customer accounts to reflect an amount less than what was actually collected. Additionally, the former employee issued receipts to customers for funds that were never deposited.

The former employee admitted to investigators that “solid waste records show that I may have taken county money for personal usage.”

Comptroller investigators also questioned $9,071.44 in write-offs and adjustments made to customer accounts. These adjustments and write-offs were not supported with any documentation.

These findings have been reviewed with the district attorney general for the Twenty-fifth Judicial District.

Comptroller investigators recommend several changes to improve financial checks and balances within the Solid Waste Department. The changes include improving the oversight of customer accounts, developing written policies and procedures, and separating money-handling responsibilities within the office.

“This case is another example of how insufficient internal controls can lead to the loss of taxpayer money,” Comptroller Justin P. Wilson said. “I am pleased to see the county mayor indicate that changes are being made.”

To view the investigation online, go to: http://www.comptroller.tn.gov/ia/.