Latest news with #NebraskaStateAuditor'sOffice
Yahoo
3 days ago
- Business
- Yahoo
Nebraska auditor: Financial wrongdoing in local governments seems ‘increasingly commonplace'
The Nebraska State Auditor's Office is located in the State Capitol. (Paul Hammel/Nebraska Examiner) LINCOLN — After Nebraska State Auditor Mike Foley issued a recent statement exposing alleged financial improprieties involving several local governments, he said his office faced a surge of callers requesting probes of their towns, too. It's a common response, Foley said, after news hits of a small-town investigation by the auditor. 'The phone starts ringing,' he said, repeating a common refrain: ''Hey look at us. Look what's happening in my village or county too.'' While grateful for the interest, Foley said such complaints are 'disconcerting' in that they could signal rising misuse of public resources in smaller public entities across Nebraska. He said the alerts also 'distract' from one of his office's other main tasks, bird-dogging the 'mega agencies' of state government. 'How much time can you spend on the Decatur Housing Authority when you've got DHHS sitting over there with 40% of the state budget?,' Foley said, referring to the Nebraska Department of Health and Human Services. Nebraska State Auditor Mike Foley said he won't announce a decision on whether he will seek reelection in 2026 until late this year or early in the next. He told the Nebraska Examiner he's happy as auditor. 'I've got a great team, very dedicated, very talented people. Happy to be here,' said Foley, 71. Foley, a Republican, said he has enjoyed his auditor tenure — 'both times.' His most recent election in late 2022 had him sworn in Jan. 5, 2023. He also served as auditor from 2007 through 2015. In between, Foley served as Nebraska's lieutenant governor. Foley began the 2014 election cycle as a candidate for governor but was defeated in the primary by future running mate Pete Ricketts, who selected Foley as his lieutenant in September 2014. Ricketts is now a U.S. senator. Foley also previously served in the Legislature, serving a Lincoln-area district from 2000 to 2007. — Cindy Gonzalez In his most recent press release June 3, Foley grouped highlights of eight audit letters he sent local governments. His office's allegations ranged from a Decatur housing chief giving herself more than $18,000 in unsupported payments to a Nemaha County commissioner caught on camera using a county gas pump to fuel his personal truck. Not all caller alerts result in investigations, Foley said, particularly if the person complaining doesn't provide enough detail. When a probe of a local government entity is launched, he said, an auditor team typically spends weeks collecting and analyzing information. In many cases, he said, someone is fired or results are turned over to law enforcement. Foley said the Auditor's Office staff of nearly 50 is down from about 60 three decades ago — and has audit oversight of roughly 2,500 units of local government. Under their watch are state agencies, officers, boards, commissions, certain political subdivisions and federal funds under contract. While acknowledging state budget concerns and competing demands, he noted that the state spends about $200 to audit every $1 million in spending. 'That's not a very good ratio.' Standing out as troubling trends during auditor reviews, Foley said, are misuse of credit cards and government-owned vehicles. 'Credit cards are an enormous headache for auditors and for these agencies,' he said, adding that too many agencies allow too many credit cards to be in circulation and are too loose with controls. Agencies are starting to install GPS trackers on public vehicles, he said, which has led to improvements. Foley assembled those eight letters sent over six weeks to local governments as part of an effort to underscore his sense that there has been an 'uptick in improper financial practices in local governmental entities.' (He said the auditor's office, meanwhile, continues to do other work and conduct other reviews.) 'Unfortunately, these more recent eight examples of both accounting incompetence and apparent financial malfeasance at political subdivisions are not unusual,' said Foley. 'Based upon my office's ongoing work, especially over the past year or so, they seem increasingly commonplace — making heightened vigilance, by public servants and citizens alike, ever more crucial.' The examples cited: Decatur Housing Authority in Burt County: In addition to allegedly processing about $18,000 in excessive compensation and unsupported reimbursements to herself, the executive director reportedly mishandled cash rental payments resulting in roughly $8,000 in 'missing money.' She reportedly tried to delete hundreds of computer files. Furthermore, Foley noted that his office earlier this year had sent a separate audit letter to the woman's previous employer pointing to an alleged salary overpayment to herself of about $11,000. The auditor's report on the Decatur Housing Authority did not indicate an effort by the audit team to contact the housing director, who was reportedly terminated from her job in February. The report said it forwarded information to various law enforcement and government agencies. The housing authority board, in its response to the state, said it was implementing steps recommended by the auditing team. Cedar County: A former Cedar County commissioner allegedly used a county pickup truck for personal business — though the commissioner denied that a few photos included in the report represented him on unofficial business. The same commissioner, according to the auditor's report, allegedly allowed payment for county services with gift cards that were largely unaccounted for — something also denied by the commissioner. The auditor's report said the former commissioner didn't provide an explanation for a gift card that was produced during the review. The county also was accused of not following proper bidding procedures for nearly $1 million in contracts. Village of Pleasanton in Buffalo County: Public employees allegedly spent more than $20,000 on village business at Menard's over a two-year period, and one employee allegedly used about $2,000 in rebate coupons as well as several hundred dollars in store credit vouchers for personal purchases. Separate 'shoddy accounting' practices, according to the auditor, resulted in the village paying thousands of dollars of claims. Village of Farnam in Dawson County: The audit team, as part of its review, identified 22 months of utility and other services, or about $2,700, that the former Village Clerk did not bill to herself. At the time of the auditor's letter, she was on the Village Board. She was found guilty of official misconduct in May, paid $3,151 in restitution, and a sentencing is set for July. Nemaha County and Nemaha Rural Fire District 4: Auditors reported that a county commissioner was photographed March 24 using a fuel pump that can be accessed after hours by personnel with insider knowledge. Dundy County: A deputy county clerk who resigned from her position at the request of the Dundy County Board continued to work and was paid full-time wages despite a considerable drop in responsibilities. Custer County: Employees are able to clock in and out of work using mobile devices, and a county highway worker was alleged to be at home or at her kids' events when she was supposed to be at work. She resigned before she could be questioned, the auditor said. Village of Litchfield in Sherman County A Village Clerk, prior to resigning, allegedly paid herself at least $2,200 more than allowed and was paid $763 in 'suspicious' reimbursement. The village allegedly failed to withhold proper taxes from employee paychecks, opening the community to retroactive payments and penalties. SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX
Yahoo
09-04-2025
- Business
- Yahoo
State auditor details ‘disturbing' spending within nonprofit serving Nebraskans with disabilities
The Nebraska State Auditor's Office is located in the State Capitol. (Paul Hammel/Nebraska Examiner) LINCOLN — A plane ticket for a 'romantic' partner and other 'suspected improprieties' have turned the State Auditor's spotlight on a small, publicly-funded nonprofit whose board is appointed by the governor and whose mission is to support Nebraskans with disabilities. A new auditor probe of the Nebraska Statewide Independent Living Council points to alleged 'malfeasance' by the former executive director, Don Dew — though Dew and the council's former treasurer insist that the spending was board-approved. Both have resigned, and assert that certain board members stirred trouble for Dew in part because he is gay. The new board chairwoman dismissed that as nonsense and said State Auditor Mike Foley was summoned after Dew did not produce requested records to support spending. Both sides agree on at least one thing. They said the gubernatorial-led process by which the board's appointments are made has been slow-going — and they believe an undersized governing board with too many unfilled slots contributed to problems. The board is authorized for 15 voting members and five non-voting members, which represent various state agencies and service providers, according to the auditor's report. For several years, current and past members said, the organization has operated with two or three voting members and several non-voting members. Currently, the council has two regularly voting board members 'with a third that is used under certain circumstances,' and 10 nonvoting members mostly representing independent living organizations, said Jody Faltys, who returned to the board in late in 2024 and is now chair. Phil Olsen, state accounting administrator under Gov. Jim Pillen, said the minimum requirement under law is three voting board members but that he foresees others being appointed soon. He said the council has seen turnover with members uneasy under Dew's financial leadership. Based in Lancaster County, the Nebraska Statewide Independent Living Council (NESILC) is funded primarily with federal dollars from the Independent Living Administration. Established in 2001, the public benefit nonprofit corporation has a mission to, in partnership with the Independent Living Network, promote independence, inclusion, non-discrimination and dignity for all people with disabilities in Nebraska. States are required to establish and maintain such independent and statewide councils, according to the auditor's report, to be eligible for financial assistance authorized under the Rehabilitation Act of 1973 that was further amended under the Workforce Innovation and Opportunity Act of 2014. State leaders said a federal grant of about $340,000 is divided between the council and two Centers for Independent Living, which are the League of Human Dignity and Independence Rising. Faltys said interest in joining the council board had waned, and she hopes that will improve. 'It's all about checks and balances, and what we need is to get those guard rails as strong as they can be to make us as strong as we can be,' Faltys said. The Statewide Independent Living Council, with an annual budget of about $115,000, is a small but vital organization whose existence is required by law to unlock federal funds that help Nebraskans with disabilities live independently. It came under auditor scrutiny after board members reported possible financial improprieties. Findings are laid out in a 25-page report, which included recommendations to improve internal controls. The report was made public last week and addressed to Faltys. Any further investigation lies with the FBI, Lancaster County Attorney and Nebraska Attorney General, which got copies of the report from Foley's office. Foley, in a statement, focused on $9,466 in what his team called 'suspected improprieties' by Dew over a three-year period: $2,043 in alleged excess pay to himself; $6,750 in health insurance reimbursements that lacked documentation, and a $672 plane ticket for his partner to a work-related conference. While better late than never, some of this could have been avoided had the NESILC board taken its oversight responsibilities more seriously from the start. – State Auditor Mike Foley 'At the risk of sounding like a broken record, I can't emphasize this enough: Allowing someone to exercise anything close to exclusive control over an organization's finances with no meaningful oversight is begging for serious trouble,' Foley wrote. He said the audit team noted the council's lack of policies and procedures for safeguarding funds and said leaders appear to be taking corrective measures. Olsen said he, representing the Nebraska Department of Administrative Services, took over in 2024 as the designated state conduit responsible for receiving and disbursing funds to the council from the federal government. He said he raised a red flag after he started attending the council's quarterly meetings and noticed a lack of bank statements, credit card and expense approvals. Faltys saw the audit as confirming 'what we saw.' Said Foley: 'While better late than never, some of this could have been avoided had the NESILC board taken its oversight responsibilities more seriously from the start.' In a response included in the auditor's report, the council recapped what led to this point. Its current leader said a COVID-19-related shutdown led to heavy change in the organization — as its only executive director up to that point retired. Dew, a former board chair, then was hired and held the position three years until his resignation effective at the close of 2024. The audit said his salary was $26,168. The council wrote that Dew 'didn't live up to the high standards' set by his predecessor. 'With board members leaving, with policies and procedures not being applied rigorously, it soon became clear that the future of NESILC was a turning point,' stated the council. The council wrote that it was disappointed in its own lack of oversight and was 'wiping the slate clean and refocusing on our mission.' Dew, with a completely different take, was angry at the allegations. He said the auditor's team didn't ask him for his version of what happened. He said he had filed his own complaint with the Nebraska Attorney General after a board member removed what he said were confidential files from a storage area. Dew said he is working with an attorney and considering legal action as he feels his name should be cleared. 'Everything had been approved,' he told the Nebraska Examiner, calling the probe incomplete. 'It's in a budget or through an executive committee meeting, so there's no way that they can say I did (anything) without approval.' Deanna Henke, treasurer of the council's board during much of the alleged misuse of funds, backed Dew. She said the board approved the airline ticket in the spring of 2024 for Dew's partner who, she and Dew said, served as a personal attendant. Dew said he has epilepsy, controlled by medication, and other disabilities. At the time of the conference, Dew said he was suffering from several broken ribs. It was not a sightseeing trip. He wasn't gallivanting around town in Little Rock, Arkansas. – Deanna Henke, former treasurer of the NESILC Henke said Dew was mandated to attend the work conference, which she said he helped lead. 'If they require a personal attendant due to their disability, then we pay … not only for Don to go, but for his assistant.' She said 'it's been that way for years,' and added 'it was not a sightseeing trip. He wasn't gallivanting around town in Little Rock, Arkansas.' According to Foley's press release, council representatives informed the audit team that the ticket was for a man with whom Dew had romantic and business relationships. The representatives said the man is 'neither an employee nor in any way affiliated with the organization.' Said Henke: 'Don being a gay man, they've had a target on his back ever since he became executive director.' Faltys said she saw no pre-approval records and called the ticket the 'final straw that broke the camel's back.' She added, 'There were no receipts. There were no minutes for meetings.' Noted in the audit were 98 'questionable' credit card transactions, besides the airline ticket, that totaled about $8,400, including for a Dropbox account, business vendors and Jimmy John's restaurant. The report said Dew controlled the card. 'Board members were not aware of, nor did they approve, most of these payments,' the auditing team said. In addition, the auditing team said it could not locate adequate documentation to substantiate board approval of 17 payments totaling $47,580 over three years for apparent reimbursements or other payments unrelated to wages, including health insurance stipends, retirement contributions and bonuses. Deputy State Auditor Craig Kubicek said in an interview that the team didn't speak directly to Dew, but its findings were based on records available at the time. 'We look at facts, we look at documentation, we look at compliance,' Kubicek said. He said Dew concurrently served as executive director of a separate organization in Iowa also dedicated to people with disabilities, and that Dew declined the Nebraska auditor team access to the Iowa payroll records. Based on that, Kubicek said his team figured it would get nowhere if it asked Dew for input on the Nebraska review, so it didn't. Meanwhile, Faltys said she is effectively acting also as executive director and pushing to add more voting board members. Herself a quadriplegic, she said the organization is more important than most understand. It works with state partners to develop Nebraska's three-year plan for independent living and community based services. It supports research, education and reforms related to disability issues. Without it, advocates said, certain federal funding could not flow to groups such as the League of Human Dignity and Independence Rising. Faltys said the availability of the services and accountability of the organization should matter to all. 'Everyone is a moment away from being disabled,' Faltys said. 'You could have a stroke, a car accident, these are issues vital to everyone.' SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX
Yahoo
07-02-2025
- Business
- Yahoo
Nebraska auditor alleges fraud affecting publicly-funded housing in Cuming County village
The Nebraska State Auditor's Office is located in the State Capitol. (Paul Hammel/Nebraska Examiner) LINCOLN — A Nebraska auditor's probe has uncovered alleged misuse of public money — including at the local WinnaVegas casino — by the manager of a publicly funded eight-apartment complex in Cuming County. During her year as the sole employee of Barber's Sunrise Villa Apartments in Bancroft, Neb., a town of fewer than 500 residents, the manager is alleged to have paid herself more than double her authorized salary, gaining an extra $11,000 over a 14-month period, according to findings released Thursday. The 11-page auditor's report identified the manager as Kayla Logeman. It said she also used the company debit card to make $820 in withdrawals at the casino resort in Sloan, Iowa and made a $27.51 fuel purchase at the nearby Pony Express gas station. The auditing team's report said it confirmed that Logeman's 'gambling activity' coincided with the withdrawals in question, and pointed to state theft laws that might have been violated. The auditors forwarded the findings to the Nebraska State Patrol, Attorney General and Cuming County Attorney for further review. It also sent findings to the USDA, U.S. Internal Revenue Service and Nebraska Department of Revenue. In all, the auditing team said Logeman's alleged improprieties from October 2023 to November 2024 totaled about $14,000. She has been placed on unpaid leave, said the report, which noted that the review was spurred by complaints of possible financial improprieties. Nebraska State Auditor Mike Foley, in a statement, said the manager exercised 'virtually exclusive control' over the corporate bank account and payroll expenses, despite having a board of directors. 'Entrusting the financial operations of an organization to one person alone, with no oversight, is a recipe for disaster,' Foley said. The nonprofit corporation set up to oversee operations of the apartment complex is the Bancroft Betterment Corporation, established in 1992 and governed by a board of directors charged with financial accountability and oversight of the housing operation. If there is anything lower than misappropriating public money meant to provide care for some of the most vulnerable members of our society, I don't know what it could possibly be. – State Auditor Mike Foley In 1993, the corporation received a loan from the U.S. Department of Agriculture's Rural Development Multifamily Housing Program, which aims to provide competitive financing for rental housing for low-income, elderly or disabled persons and their families. The loan, according to the auditing team, has an outstanding balance of about $214,500. Said Foley: 'If there is anything lower than misappropriating public money meant to provide care for some of the most vulnerable members of our society, I don't know what it could possibly be. Unfortunately, that is what very well may have occurred here.' According to the state auditing team, the Bancroft Betterment Corporation receives funding from rental revenue paid by tenants as well as any federal rental assistance for tenants in excess of the amounts owed to USDA Rural Development for the loan. The head of the nonprofit's board declined to comment Thursday to the Nebraska Examiner. But the group responded, in the report, to the auditing team's recommendations. Auditor's Office recommendations to the nonprofit included implementing procedures to prevent one person from being in a position 'both to perpetuate and to conceal financial errors or irregularities.' The board stated in the report that it had made several corrections, including removing all financial access and abilities from employees. It said only the four board members have access to banking privileges. The board also canceled any debit cards associated with its accounts. SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX
