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State Employee Scam Burns Taxpayers

Monday April 13th, 2015   •   Posted by K. Lloyd Billingsley at 8:53am PDT   •  

CDF_200In California, prodigious waste of taxpayer dollars is inherent in the system but politicians look the other way and few in the old-line establishment media are watching. One notable exception is Jon Ortiz of the Sacramento Bee, co-author with Jim Miller of “The Public Eye” watchdog report headlined “Audit: California departments break law, game personnel system for money.” According to the audit from the State Department of Finance, “California state departments illegally pad their budgets with millions of tax dollars earmarked for employee salaries by manipulating their payroll to make it appear they have more employees than they do.”

If a position goes unfilled for six months, the law requires funding for that position to return to its source. But Ortiz and Miller found the “departments deceptively move employees between jobs ahead of the six-month deadline. They accomplish the phony transfers by altering the identifying job numbers to make it appear that a position was filled with a transferred employee, thus avoiding a cut to their budgets.” And that “state worker shuffle” squares with the audit, which found some employees transferred into multiple positions, with no documentation for transfers, and other “widespread noncompliance” with state law. According to the audit, skirting the law was “commonplace and even encouraged by management.”

This happens because, as Ortiz and Miller note, “there are no state policies regulating the movement of vacant positions within a department,” and, “departments face no penalties for violating the law.” Ten departments said they complied but the auditors found nine were not in compliance. The audit did not calculate the money involved in the scam but Ortiz and Miller cite a 2014 investigation estimating “at least $80 million” from “illegal vacancy maneuvers.” And as we noted, state departments are also fond of stashing funds in secret accounts.

Meanwhile, no California politician heralded the new state personnel audit and announced new legislation to change the system. No politician called for those responsible to be held accountable. So the waste and fraud are likely to continue, all part of the corruption inherent in the system.

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April 2015