Thursday, June 19, 2014

Further investigation required

We really were not that surprised to learn that the now convicted former occupant of the office of Mayor somehow managed to create a“secret” bank account. After all, it fits the mold and methods of a man who used the city treasury as his own.

The revelation does leave many unanswered questions:

How was it accomplished without the knowledge of or approval from anyone in the finance department? If the auditor could find it, shouldn’t the checks and balances in the financial systems have picked it up sooner?

How much money was involved? Is there any left in the account? What was the money spent on?

Most importantly, will the Mercer County Prosecutor’s Office open a full investigation into this? Will they bring the matter to a grand jury?

We should not concern ourselves with the fact that Mr. Mack has already been tried and convicted on Federal Corruption charges. This is about making someone fully accountable for the wrong they have done…at all levels. It is doubtful that Mr. Mack acted alone in this and anyone else who aided and abetted this deception needs to be charged accordingly. It is also about showing others that this kind of corruption will not be tolerated…at any level.

The above referenced article also revealed that there have been some issues with personnel working “out of title” and lack of controls over authorized overtime.

The audit covered the period of SFY2013 (July 1, 2012 – June 30, 2013). The report is just being made public to the city council. Sam Hutchinson, the city Business Administrator, admitted there were issues due to the massive layoffs but that things had been corrected “now.”

State statute 40:69A-44 describes the qualifications, powers and duties of the Business Administrator.

The department of administration shall be headed by a director who shall be known and
designated as business administrator. He shall be chosen solely on the basis of his
executive and administrative qualifications with special reference to his actual experience
in, or his knowledge of, accepted practice in respect to the duties of his office as
hereinafter set forth. At the time of his appointment, he need not be a resident of the
municipality or State, but during his tenure of office he may reside outside the
municipality only with the approval of council. He shall have, exercise and discharge the
functions, powers and duties of the department. The department, under the direction and
supervision of the mayor shall:

(a) Assist in the preparation of the budget;

(b) Administer a centralized purchasing system;

(c) Be responsible for the development and administration of a sound
personnel system; and

(d) Perform such other duties as council may prescribe.

(e) The governing body of the municipality may provide, by ordinance, that
the business administrator also shall, subject to the direction of the mayor,
supervise the administration of each of the departments established by ordinance.
For this purpose, he shall have power to investigate the organization and
operation of any and all departments, to prescribe standards and rules of
administrative practice and procedure, and to consult with the heads of the
departments under his jurisdiction; provided that with respect to any department
of law or department of audit, accounts or control, the authority of the business
administrator under this subsection shall extend only to matters of budgeting,
personnel and purchasing.
 L.1950, c. 210, p. 476, s. 3-14. Amended by L.1954, c. 68, p. 422, s. 2; L.1981, c. 462, s. 40; L.1981, c. 465, s. 19, eff. Jan. 9, 1982.

While it is true that Mr. Hutchinson did not come on board until April of 2012, “the development and administration of a sound personnel system” is one of the BA’s duties as enumerated in the state statute. 

When did Mr. Hutchinson become aware of these issues? How and when did he address them? Was the governing body made aware of the problems and corrections prior to the auditor’s report? (It certainly doesn't seem like it from the newspaper account)

In August of 2006 Mercer County Prosecutor Joe Bocchini removed former chief financial director and comptroller Christine Stankiewicz from city hall amid allegations of payroll fraud.

Has the prosecutor’s office been notified of the auditor’s recent findings as outlined above? If not, why not?

We hope and hereby suggest that the Mercer County Prosecutor open a full investigation into both of the matters outlined in the Mercadien report immediately.