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Monday, January 19, 2009

Inspector general blasts D.C.’s internal controls on money

The D.C. government must tighten its internal controls on vendor payments, tax refunds and payroll in the face of “significant fiscal challenges that we believe will continue into the foreseeable future,” the D.C. inspector general recently warned.

The IG’s office issued a report earlier this month that advised D.C. leaders of many weaknesses in the District’s payment processes that were uncovered in recent audits. Those failures include insufficient management oversight, ineffective supervision, lack of policies and procedures, poor file maintenance, disregard for regulations and unfamiliarity with standards of conduct.

Many of the internal control weaknesses emerged from reviews of the Office of Tax and Revenue, home to the costliest scam in D.C. government history. Harriette Walters, a midlevel OTR employee, stole nearly $50 million over 20 years by manipulating the property tax refund process, revealing the absence of any anti-fraud program within the office.

Chief Financial Officer Natwar Gandhi, under whose watch the money was stolen, has said repeatedly that his office is re-evaluating and strengthening anti-fraud programs and installing numerous controls on the tax refund process.

The problems go well beyond the tax office, the IG reported.

- Michael Neibauer, DC Examiner.com


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