The tip of the iceberg (WIB 8)

So Konnie Beasley had quite a mess on her hands.

Ms. Beasley attended quarterly meetings in Indianapolis, where the status of programs of this nature state-wide were reviewed. These meetings confirmed what she had already come to believe - that "the agency" had major fiscal problems. These meetings also revealed that her situation was highly unusual.

She writes that she gained "superb assistance" from the people attending theses meetings.

"It was at that time I sought help and advice from Bruce Kimery, Deputy Commissioner of Indiana Workforce Development. After a couple of meetings with Mr. Kimery, ("the agency") was required to have an outside audit performed. The state chose Cole & Dunton and helped fund that audit. The results of that audit laid bare the dysfunction of the WIB."

Let's cut away to the Commisioner of the Indiana Workforce Development, Alan Degner letter, published in its entirety on this blog in 'What Juan Manigualt Cost You". This letter to Mayor of South Bend, Steve Luecke, penned October 6, 2004 summarized the findings of multiple auditors and agencies. Here is a relevant excerpt.

"In September 2001, Cole and Dunton's submitted a report that supported the findings of DWD monitoring reports that indicated serious deficiencies in record keeping which included:

fraudulent checks totaling $60,000;

more than $77,000 that could not be reconciled between NIWIB and the St. Joseph County Auditor's records;

the financial system could not produce a balance sheet;

travel expenses charged to NIWIB credit cards that were lacking appropriate documentation under IRS standards: ( Ms. Beasley notes that these would have been for Juan Manigault's travel)

procurement of $24,000 in business equipment charged to two different funding pools;

accounting software (in use) that could not generate financial statements for each fund or entity; and

no documentation presented or available to close-out records that supported the reconciliation of the case receipts recorded by NIWIB to the summary of cash draws from the grantor."

I'd ask the reader's indulgence to carefully consider that last point above, because in retrospect it may be the most telling observation and it was advanced in September of 2001.

Ms. Beasley, in one of our conversations indicated that Juan Manigault engaged in something of a fiscal shell game to account for a given desired expenditure. He would look at available balances in funds and assign the expense to one that had room. [The reference to cash draws (another term is draw downs) refers to an application for expensing an amount less than the total of the fund]. When expenses which actually pertained to the grant would occur - surprise, surprise - there likely would not be a sufficient balance available to cover the legitimate costs. We'll return to this point in the future.

How about sixty thousand dollars in fraudulent checks? Ms. Beasley explained that the physical checks appeared to be created by superimposing checks from one agency account over checks from the other. I can't really visualize the effect of that, but it certainly hints at an inside job.

From multiple sources: The checks were cashed in South Carolina, the mechanical signature apparatus of the agency was employed, no recovery was made on behalf of the taxpayers and there were at least two straightforward ways recovery could have been made on behalf of the taxpayers.

That's right. I claim that the taxpayers could have been spared the sting of sixty thousand dollars stolen from them if the person in charge - Juan Manigault - had conducted his duties in a way even approaching competence.

How? First of all, the bank that cashed the fraudulent checks had insurance. Secondly, the agency itself had insurance. But in order to collect, timely reporting had to be done. I'm told it wasn't.

Naturally, if a claim was filed either way, there would have been a pretty detailed investigation. I've heard suggestions that that might not have been desired.

In any case, why don't we have answers to these questions by October 2007? And why is it we (private citizens) are wrestling with them now? Where are the watchdogs? Where is the "professional" media?

There's more.

Don Wheeler