The former head of a defunct Arkansas nonprofit that helped at-risk youth was sentenced Wednesday to 30 months in prison for diverting more than $120,000 from the group to an unnamed state senator in a widening corruption probe that has ensnared several former lawmakers.
U.S. District Judge Susan O. Hickey sentenced Jerry Walsh, 72, who pleaded guilty in 2018 conspiring to divert more than $380,000 from South Arkansas Youth Services without the authority of the organization’s board of directors. Federal prosecutors say the scheme involved diverting the money to a state senator identified only as “Arkansas Senator C” and the lobbying firm of Rusty Cranford, who pleaded guilty in 2018 to bribing three former lawmakers.
Hickey also ordered Walsh to pay more than $515,000 in restitution.
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A nonprofit crime-victims advocacy organization misappropriated nearly $200,000 in grant money from the Washington Attorney General’s Office by submitting invoices for tasks the group didn’t actually complete, a new report from the state auditor found. Washington Coalition of Crime Victim Advocates (WCCVA) misappropriated $199,978 in state money between 2015 and 2017, the report found. The Legislature, in 2013, ordered the Attorney General’s Office to give annual grant money to the WCCVA to fund training for crime-victim advocates.
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Washington Attorney General Bob Ferguson
All the counseling, therapy and medication did little to ease 9-year-old Sobie Cummings’ crippling anxiety and feelings of isolation. And so a psychiatrist suggested that a service dog might help the autistic child connect with other kids. To Glenn and Rachel Cummings, Mark Mathis seemed like a dream come true. His kennel, Ry-Con Service Dogs, was just a couple of hours away, and he, too, had a child with autism. But what clinched the decision were Mathis’ credentials. “Is Ry-Con a certified program? Yes,” stated an online brochure. “In 2013, Mark was certified as a North Carolina state-approved service dog trainer with a specialty in autism service dogs for children.”
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New Mexico State Auditor, Tim Keller, states that the allegations against a charter school manager for mishandling $700,000 indicate a larger pattern of poor oversight. According to Keller’s investigation, Julieanne Maestas, La Promesa’s former assistant business manager, diverted more than $475,000 from La Promesa into her personal bank account from June 2010 to July 2016. In addition, she deposited about $177,000 worth of checks that were payable to the former executive director – her mother, Albuquerque Public Schools board member Analee Maestas – as well as to her boyfriend, who was a school maintenance vendor. The La Promesa Early Learning Center was audited annually, but the audits did not discover any evidence of fraud or embezzlement throughout the six years of alleged mishandling.
In Fiscal Year 2017, federal agencies reported $8.8 billion in confirmed fraud, according to a new report by the U.S. Government Accountability Office. The GAO report looks at progress made by federal agencies and OMB to reduce fraud risks since Congress enacted the Fraud Reduction and Data Analytics Act of 2015 (FRDAA). That Act requires agencies to establish financial and administrative controls for managing fraud risks, creating a Fraud Risk Framework in the process.
One leading practice described in the Fraud Risk Framework is using the results of monitoring, evaluation, audits, and investigations to improve fraud prevention, detection, and response. In its new report, the GAO said that about 86 percent of agencies indicated that they use results of monitoring, evaluation, audits, and investigations to manage fraud risk, but only 54 percent did so on a regular basis.
The federal agencies’ reports of their fraud risk management activities is illustrated below:
Areas of risk include grant fraud, defined as when award recipients attempt to deceive the government about their spending of award money outside the parameters of the grant. Other high risk areas described in the report are payroll, beneficiary payments, large contracts, and purchase and travel cards.
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Maintaining integrity should be a key goal of educational leadership. One scandal can mar a system’s reputation irreparably and derail its mission. Knowing the signs of a compromised organization can help school board members reduce risks to reputation. This is more important as the educational landscape becomes increasingly competitive, and families find more options.
One red flag is the deafening silence of underlings in the presence of their supervisors, particularly when questions are directed at them. Employees who don’t speak up are often afraid of retribution. While effective school board members know that day-to-day management should be left to the school leader, they shouldn’t shy away from speaking with staff at every level. Such information is critical for effective oversight. Beware of supervisors who prohibit that.
To learn the signs of a compromised organization click here
By Emily Richmond of the Education Writer's Association
There’s an old saying that To a Hammer, Everything Looks Like a Nail. To an auditor,
everything can look like an audit—even when it’s not an audit, but a subrecipient monitoring review.
For example, one state’s Single Audit found that the pass-through entity improperly determined that subrecipients were low risk despite negative publicity and significant leadership turnover. Auditors disagreed with the pass-through entity that only subrecipients who distribute grants are high risk.
The Department of Education provides billions of dollars in grants for programs to improve K-12 outcomes. Do they work?
The U.S. Government Accountability Office (GAO) recently released its report on the challenges of assessing grant programs serving K-12 students. Education faces challenges determining whether these programs work. Specifically, problems persist with:
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The Council of the Inspectors General on Integrity and Efficiency (CIGIE) launched their Oversight.gov website last year, allowing the public to see the reports and recommendations of 73 Inspectors General offices. According to Michael Horowitz, Justice Department IG and CIGIE chairman, the Inspector Generals are there to ensure that “…taxpayer money is being wisely used, appropriately used, not wasted, and that government programs are being run effectively and efficiently.” The website includes a chart depicting the potential cost savings identified in the reports of the IG over the current fiscal year, usually reaching $20 million. The website allows for further transparency and accountability on behalf of the government.
Our mission is to deliver meaningful oversight solutions for large-scale programs serving vulnerable populations such as children, seniors, people with disabilities, and victims of crime.