State of New Jersey Office of the State Comptroller Bringing - - PowerPoint PPT Presentation

State of New Jersey Office of the State Comptroller

Bringing greater efficiency and transparency to the

• peration of all levels of New Jersey's government

State Comptroller, Philip James Degnan

New Jersey Office of the State Comptroller

Overview of Presentation

• Office of the State Comptroller

– History, Mission, Statutory Authority, Divisions

• Investigations Division

– Origin of Investigations (complaints, referrals) – Investigatory Tools and Resources – Final Work Product

• Public Reports and Recommendations to Public

Entities and / or Lawmakers

New Jersey Office of the State Comptroller

Who Are We?

• The Comptroller is appointed by the Governor with the advice

and consent of the Senate to a six-year term.

• Can be removed only for cause.
• We are an independent office established in the Executive

Branch of State government. The office is in, but not of, the Department of the Treasury.

• The Comptroller reports directly to the Governor.

New Jersey Office of the State Comptroller

Our Mission To promote integrity and transparency at all levels of New Jersey government by auditing government finances, examining the efficiency of government programs, investigating misconduct by government officers, scrutinizing the legality

• f government contracts and recovering

improperly expended Medicaid funds.

New Jersey Office of the State Comptroller

Our Responsibilities

• Audit and assess State government entities’ and local

government units’ performance and management of programs and the extent to which they are achieving their goals and objectives

• Scrutinize government contracts; and
• Investigate and uncover misconduct, waste and

abuse at all levels of New Jersey government and within New Jersey’s Medicaid program.

New Jersey Office of the State Comptroller

Audit Division - responsible for conducting audits and reviewing the

performance of the executive branch of state government, public institutions of higher education, independent state authorities, local governments and school districts.

Procurement Division - reviews the legality of public contracts involving

school districts, counties, municipalities, state agencies, state authorities, local authorities and public institutions of higher education.

Medicaid Fraud Division - detects, prevents and investigates waste,

fraud and abuse in the Medicaid, New Jersey Family Care and Charity Care

• programs. The division also recovers improperly expended Medicaid funds,

reviews the quality of care given to Medicaid recipients and excludes or terminates providers from the Medicaid program when necessary.

New Jersey Office of the State Comptroller History of the Investigations Division: OIG Abolished and Duties Transferred to OSC

• 2010: Office of the Inspector General (OIG) was abolished and all of the

duties, powers and functions of that office were transferred to OSC.

• References in the statute or other documents to the OIG are now

incorporated into our powers within OSC. N.J.S.A. § 52:15C-21

OIG OSC

New Jersey Office of the State Comptroller Powers of Investigations Division

• Power to conduct investigations, reviews and evaluations;
• Must do so in accordance with prevailing national standards;
• Power to compel appearance and testimony by subpoena;
• Power to compel production of documents by subpoena;
• If subpoenaed to provide testimony, individual has right to be

accompanied by counsel and shall be entitled to all due process rights. N.J.S.A. § 52:15B-8. Powers of the Inspector General

New Jersey Office of the State Comptroller Sources of OSC Investigations

The Investigations Division receives tips, allegations and referrals from a variety of sources, including:

• OSC Hotline – Government Waste and Mismanagement Hotline
• Referrals from other state or local government units
• News media or public reports
• Proactive investigations

New Jersey Office of the State Comptroller

• OSC investigators field and review all

tips.

• Tips come from the general public and

from government employees.

• Tips are received by phone, via email or

through the mail.

• Some tips are fruitful and have led to

great investigations, while others may lead to referrals or close-out, if not within our jurisdiction.

Government Waste and Mismanagement Hotline

New Jersey Office of the State Comptroller Considerations for Further Investigation

• Public actors
• Public funds
• Jurisdiction
• Other investigations or litigation
• Political/policy issues
• Timeliness
• Resources

New Jersey Office of the State Comptroller Authority to Refer Complaints

• OSC is authorized to refer complaints received that allege criminal

conduct to the Attorney General or other appropriate prosecutorial authority.

• In the course of conducting audits, investigations, and performance

reviews, OSC may also refer matters for further civil, criminal, and administrative action to the appropriate authorities. N.J.S.A. § 52:15B-11

New Jersey Office of the State Comptroller Close-Out / Referral Letter

• Acknowledgment letter
• Acknowledgment letter and notice of referral (e.g. Sandy Task Force,

DCA/LGS, IG, etc.)

New Jersey Office of the State Comptroller Significant Referrals

Newark Watershed Conservation and Development Corporation

The former executive director of the Newark Watershed Conservation and Development Corporation… “admitted accepting approximately $999,000 in kickback payments…” pleaded guilty to… wire fraud and subscribing a false tax return for the year 2012…

New Jersey Office of the State Comptroller

Wire fraud charge = maximum potential penalty of 20 years in prison Filing a false tax return = maximum potential penalty of 3 years in prison Both charges are punishable by a fine of $250,000 or twice the amount of the pecuniary gain or loss from the offense. Sentenced in 2017 to more than 8 years in prison.

New Jersey Office of the State Comptroller NWCDC: Convictions Still Ongoing

Sentencing pending for a consultant to the NWCDC who pleaded guilty to wire fraud and faces up to 20 years in prison for her role in the scheme.

New Jersey Office of the State Comptroller

Investigative Tools and Resources

• Document Request
• Subpoena
• Interviews
• Database Searches (Clear, MVC, Wages, Pensions, etc)
• Social Media/Internet Searches
• Surveillance
• Site Inspections

New Jersey Office of the State Comptroller Cooperation with OSC by State agencies

OSC is authorized to call upon any department, office, division or agency of State government to provide such information, resources, or other assistance necessary to fulfill the duties and functions and responsibilities

• f OSC under this act.

Each department, office, division and agency of this State shall cooperate with OSC and furnish the office with the assistance necessary to accomplish the purposes of this act. N.J.S.A. § 52:15B-6

New Jersey Office of the State Comptroller Report of findings, recommendations

OSC shall report the findings of investigations performed by the office, and issue recommendations for corrective or remedial action, to the Governor, the President of the Senate and the Speaker of the General Assembly and to the entity at issue. OSC shall monitor the implementation of those recommendations. N.J.S.A. § 52:15B-15

New Jersey Office of the State Comptroller

Investigations Division Reports

New Jersey Office of the State Comptroller

Findings/Recommendations

• NJSFA and the LRAs Accumulated Nearly $245 Million Due to

Antiquated Statutory Restrictions that Limit How the Funds Can Be Spent

• A Lack of Oversight and Internal Controls By NJSFA Resulted in

Questionable Relief Payments

• Some LRA Officers Signed Their Own Relief Checks Because NJSFA Did

Not Have a Written Recusal Policy to Guard Against Abuse

• Little to No Oversight By Any State Agency
• Referral to Legislature to Amend Statutes
• Recommendations to NJSFA to tighten controls

New Jersey Office of the State Comptroller Municipal Tax Assessors: Conflict of Interest

• Referral from a criminal agency
• Conflict arose if Tax Assessor also worked for the revaluation firm hired

by municipality to perform the revaluation

• Existing law did not prohibit this dual employment
• Interviewed Division of Taxation and Local Government Services
• Issued Letters with Recommendations to both agencies

New Jersey Office of the State Comptroller Low Income Home Energy Assistance Program

New Jersey Office of the State Comptroller

FINDINGS / REFERRALS

LIHEAP is a federal program administered by the State that provides home energy assistance to qualified residents. NJ received over $250 million in LIHEAP funding during the two year period reviewed by OSC. OSC reviewed a sample of LIHEAP applications that were processed by a non-profit agency. OSC uncovered the following due to a lack of proper oversight by the Department of Community Affairs:

• Applicants who underreported income earnings by over $10,000
• Three public employees who earned in excess of eligibility requirements

and who failed to report secondary income Over 30 applicants with invalid social security numbers, a prerequisite to eligibility

• SSNs associated with deceased applicants
• SSNs that did not match up with applicants name and/or DOB

Resulted in referrals to DCJ and DCA

New Jersey Office of the State Comptroller

NJ State Police Periodic Reports

OSC “shall conduct risk-based audits and performance reviews of the Division of State Police and the office to examine stops, post-stop enforcement activities, internal affairs and discipline, decisions not to refer a trooper to internal affairs not with-standing the existence of a complaint, and training. The State Comptroller may also make recommendations on the funding and staffing levels of the office and the State Police.” N.J.S.A. § 52:17B-236

New Jersey Office of the State Comptroller

NJSP / OLEPS Periodic Reports

New Jersey Office of the State Comptroller

NJSP / OLEPS 5th Periodic Report

• Observed the process by which a complaint of trooper misconduct is

handled from intake through investigation and adjudication.

• Reviewed case files on 130 complaints of misconduct.
• Interviewed NJSP mangers and investigators responsible for conducting

misconduct investigations.

• Made recommendations to NJSP and the Attorney General to improve

investigations of misconduct allegations.

New Jersey Office of the State Comptroller

How Can I Help?

• If you see something that raises a concern, call our hotline.

Investigative staff is available Monday through Friday, 7:30 to 4:30.

• We answer the phone!!
• If you call after hours, we return call within 24 hours

New Jersey Office of the State Comptroller

Nicole Acchione Assistant Director of Investigations, Attorney in Charge 609-789-5001 Nicole.acchione@osc.nj.gov Richard O’Brien Assistant Director of Investigations, Special Investigator in Charge 609-292-4782 Richard.O’brien@osc.nj.gov

• @NJComptroller

www.nj.gov/comptroller