MCCCD launches fraud probe - East Valley Tribune: East Valley Local News

MCCCD launches fraud probe

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Posted: Tuesday, November 7, 2006 5:03 am | Updated: 5:06 pm, Fri Oct 7, 2011.

November 7, 2006

The Maricopa County Community College District’s top officials plan to review and possibly reopen numerous internal fraud audits from the past two years and punish any employee misconduct.

MCCCD governing board president Scott Crowley said this is a step toward correcting wrongdoing that has been allowed to fester throughout nation’s largest junior college system.

“I’d love to go back 10 years. I’d love to go back 15 years,” he said. “But two years is realistic.”

Chancellor Rufus Glasper, in an editorial column released to the local media, also has identified an array of reviews aimed at preventing malfeasance.

The scrutiny comes as Scottsdale Community College, the subject of multiple major fraud audits in 2005, faces a reaccreditation process to determine whether the campus can continue awarding degrees.

Glasper said MCCCD’s proposed changes are largely in response to a Tribune investigation, published last week, which found the colleges routinely failed to take action over the past five years when malfeasance surfaced.

“The recent stories in the Tribune illustrated some weaknesses in our internal controls as well as errors in judgment by a few individuals,” he wrote in a column published in local newspapers.

In the coming months, Crowley said, the district’s 10 college presidents will be called before the governing board to account for what auditors discovered at their campuses and how the presidents responded.

If the board — comprised of five elected officials — finds that presidents did not take sufficient action, the internal audits could be reopened, Crowley said.

The board “does have the potential to reevaluate past audits, if they were not handled appropriately,” he said.

In those instances, the board could order Glasper to seek restitution, demote or fire employees responsible for fraud and file criminal charges.

The Tribune’s investigation into five years worth of audits found employee theft, enrollment fraud and nepotism at colleges throughout the district.

The auditors’ findings were detailed in damning reports. However, those reports were rarely read by anyone other than the perpetrators and their bosses.

College officials did not notify law enforcement when criminal activity was discovered, in one case ignoring an auditor’s specific recommendation to do so. Troublesome employees were regularly shifted or allowed to resign quietly after offenses were uncovered.

Now, Glasper says, his office will follow up to ensure auditors’ recommendations are implemented.

The chancellor said he will also create an outside panel to look at the district’s operations and recommend reforms.

At SCC, the Tribune determined the director of a performing arts institute used special service contracts to pay himself for work his salary covered and sometimes for work he never did. The contracts, which MCCCD uses to compensate employees for work outside of their regular duties, netted him tens of thousands of dollars on top of his salary each year.

Also at the arts institute, an auditor discovered that employees were enrolling in classes to protect them from being canceled and to steer teaching fees to some faculty.

The institute director received only a reprimand letter that neglected to mention falsified enrollment.

The district will review how special service contracts are awarded and what oversight is necessary to prevent abuse in the future, said Debra Thompson, vice chancellor for business services. A separate inquiry is expected to determine if enrollment fraud is prevalent at any of the other campuses.

“We want to be thorough, so we want this to be a districtwide review,” Thompson said.

While any significant reform still awaits completion of these reviews, Glasper said he has already ordered that the entire governing board receives copies of audit reports.

Previously, only two board members were informed of audit findings through a separate audit committee. One of those members has not attended an audit committee meeting in at least four years; the other did not raise questions over the malfeasance.

Those audits, however, are likely to prompt questions when the North Central Association of Colleges and Schools arrives at SCC early next year.

Art DeCabooter, president of the Scottsdale college, said the association’s team will receive copies of all audits completed since 1997, the last time SCC was reaccredited.

The association this week began asking for community input about SCC, publishing announcements in local newspapers. While enrollment fraud and contract misuse are likely to be a factor in the college’s accreditation, DeCabooter said those problems would not sink SCC’s chances.

“I don’t think it will have a negative impact,” he said.

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