Tuesday, June 25, 2019
Happening Now

Comptrollers Office Cites Lack of Oversight in Fraud, Theft Cases

The Tennessee Comptroller’s Office reports a lack of oversight can potentially result in fraud and theft cases.

Public Information Officer John Dunn says most cases involve only one person handling an entity’s finances.

“The same person is responsible for multiple financial tasks,” Dunn says. “You have one individual who’s collecting money, who’s recording money on the accounting statements, who’s depositing money into the bank, who’s reviewing the bank statements at the end of the month. And there is no supervision that’s a part of that process.”

The TBI launched an investigation into the Fentress County Financial Office last week following reports of missing funds.

Dunn says having a lack of supervision when it comes to government finances can often lead to problems in the future.

“When one person has too much control over any part of the financial processes, it provides an opportunity for fraud, waste, and abuse to occur,” Dunn says, “and it can go undetected for months, if not years.”

Dunn compared having increased internal control over finances to a parent looking after their children’s internet usage.

“You wouldn’t just turn your child loose and hope that they’re looking at things that are appropriate. A parent would often want to check up and make sure that the child has some sort of oversight there,” Dunn says. “Internal control is a real strong way of developing processes whereby one person isn’t given too much responsibility and opening the gate to fraud, waste, and abuse.”

Those in the center of fraud or theft cases are usually ones who have fallen on hard times, Dunn says.

“If there’s a need for financial security, if someone is going through a difficult time in their life, and they see an opportunity there to take money that’s not theirs,” Dunn says, “and they understand they could get away with that crime, then that increases the opportunity and the likelihood that something could occur.”

Dunn says although each case handled by the comptroller’s office varies based on finer details, investigations typically follow the same formula.

“Primarily, when our office gets involved, we look at a number of pieces of documentation, we perform interviews, we gather evidence, and we proceed in that manner,” Dunn says. “Often times, when a person is confronted with the fact that we’ve caught them stealing, we find that they confess because usually, we have the evidence supporting whatever theft has occurred.”

Dunn declined to comment on the current Fentress County Financial Office investigation.

The Comptroller’s Office investigated five cases involving Upper Cumberland entities in 2018. The UCHRA, Overton/Pickett E-911 District, City of Smithville, Smith County Public Library, and Pickett Ambulance Services were all investigated.

Only one of the five led to criminal charges, with Former Smithville Mayor Jimmy Poss being indicted on official misconduct and theft charges last July.