The D.C. finance office’s investigative arm closed dozens of fraud, theft, embezzlement, bribery and other cases in fiscal 2008 during what the branch termed a “particularly challenging year,” given the fallout of the $50 million tax office scandal.
The Office of Integrity and Oversight under Chief Financial Officer Natwar Gandhi opened a record 94 investigations last fiscal year and closed 80, according to a recently completed annual report, obtained by The Examiner through a Freedom of Information Act request.
The number of tips soared in the wake of revelations of massive fraud within the Office of Tax and Revenue.
The unraveling of the OTR scam led to numerous, unrelated allegations of fraud and abuse across Gandhi’s organization, according to the report. It also spurred a new policy demanding background checks of all longtime staffers, which uncovered at least one employee with a hidden criminal past.
Between Oct. 1, 2007, and Sept. 30, 2008, 19 Office of the Chief Financial Officer employees were either terminated or forced to resign, including some tied to the tax office scandal. An additional seven were targeted for “management correction,” four were suspended, and one person faced “removal/reassignment.” Thirteen cases were closed without action and 20 are still pending adjudication.
The annual report includes a brief overview of the Harriette Walters tax office scam, a two-decade-long fraud within the Real Property Tax Administration that drained D.C. coffers of roughly $50 million. While investigating that crime, “evidence was developed that resulted in the conviction of two OTR employees for mortgage fraud,” according to the report.
Among other notable catches, all of whom were fired:
An OTR employee was nabbed for generating fraudulent personal income tax refund checks.
Another tax office staffer was nailed by D.C. and the FBI for soliciting a $6,000 bribe from a taxpayer during an audit.
One supervisor and one manager in the Office of Finance and Treasury were caught drawing checks for themselves. One also borrowed $900 “from the vault.”
Despite the heavy workload, the integrity office remained short-staffed into fiscal 2009, the report states. City government sources said Monday that “positions are being filled.”
It is Gandhi’s job to ensure “the resources within his office are accordingly allocated,” said D.C. Councilman Jack Evans, chairman of the Finance and Revenue Committee. The Office of Integrity and Oversight, Evans said, must have every tool at its disposal.
“It’s more highlighted now,” Evans said of fraud in the OCFO. “You’re going to have more cases because people are paying attention.”
