NMI loses chance to recover misused $50K

The cash-strapped Commonwealth government has missed its chance to recover at least $50,000 of misused public funds, a report by the Office of the Public Auditor revealed.

OPA, in an update on the status of its audit recommendations to various agencies, said the government now has no hope of collecting from individuals involved in five corruption cases.

The cases had been referred to the Attorney General’s Office for legal action to recover the funds. But the AGO recently told OPA that the statute of limitation—or the time period within which the government could bring a lawsuit against the involved parties—had already expired.

The case to have the statute of limitation run most recently, involved the Commonwealth Utilities Corporation. In 2001, OPA found that CUC made improper payments totaling almost $3,000 to board members who had gone on official trips. The finding was referred to the AGO, but no legal action was taken until the statute of limitation expired in 2007.

One case, which had the statute of limitation run in 2001, involved overpayments made by the Commonwealth Ports Authority to former board members. Over $40,000 remains uncollected from the involved board members.

Yet another case, which had the statute of limitation expire in 2002, involved a former director Rota Health Center, who had paid too much for repairs and non-existent lease extensions out of the Rota imprest fund account. Some $9,000 was to be collected from the former official.

It is not known how much the government could have collected if it pursued legal action against a former executive director of the now defunct Marianas Public Lands Authority, who received double payment of travel expenses and excessive per diem allowances from September 1992 to September 1994. OPA was advised to close the matter, as the statute of limitation ran, at the latest, in 2001.

Legal action had also been OPA’s recommendation in another MPLA case, involving recovery of rentals due from a restaurant and recovery from a lessor of all payments collected for the subleasing of the Saipan Fishing Center building as of Oct. 31, 1995. The amount that could have been recovered from the case is also unknown. The statute of limitation expired in 2002.

As of Dec. 31, 2007, audit recommendations in 13 OPA reports had been referred to the AGO for legal action to recover improperly expended funds. According to these audit reports, some $2.6 million is potentially recoverable. This includes about $1.3 million in overpayments of professional services contracts, and $1.1 million from the Tinian gaming commission.

OPA had identified potential recoveries of another $4.6 million in eight audit reports to various agencies. Of the $4.6 million, $950,000 has been partially recovered, leaving a balance of $3.7 million as still potentially recoverable.

Nearly $3 million of this amount is due from the defunct Marianas Public Lands Authority, which failed to collect rentals from quarry operators from 1990 to 1995. The $3.7 million also includes about half a million dollars of unpaid nonresident worker application fees that the Department of Labor has yet to recover from two companies.

OPA issues a report on CNMI agencies’ implementation of audit recommendations every six months. The latest report covers the period as of Dec. 31, 2007.