OPA audit identifies $2.6M in ‘recoverable’ funds

The Office of Public Auditor has found approximately $2.628 million in government monies expended improperly by agencies and that can be recovered by the cash-strapped government if actions will be taken by the Office of the Attorney General.

The collectibles were as of Dec. 31, 2010, according to the OPA’s audit report on CNMI agencies released yesterday.

“As of Dec. 31, 2010, recommendations in seven audit reports were referred to the [OAG] for legal action to recover monies improperly expended. On May 17, 2011 OPA requested an update on these referrals. The [OAG] did not respond to this request or provide OPA an update on these referrals. As such, the status of these referrals remains unchanged,” states the report.

Of the potentially recoverable funds, OPA said that $4,982 can be recovered from a former Rota Health Center director as reimbursement for the cost of a washing machine taken from RHC funds for the period December 1993 to March 1996.

Another $75,000 could be recovered from a former Finance secretary who misused the money during fiscal years 1995 to 1997.

Some $2,200 is also recoverable from a former Washington Representative as balance of a loan receivable made to a CNMI constituent. Legal action is also needed to recover an overpayment of $543,375 from a consultant of the Tinian Casino Gaming Control Commission on grounds of unjust enrichment, conversion, fraud, and breach of fiduciary duty and $195,971 from three other individuals for breach of fiduciary trust.

OPA also disclosed that the CNMI government has $1.315 million in overpayments of professional services contracts.

At the Department of Public Works, $100,000 can be recovered as improper payments made to a surveying contractor in 1997. Another $392,178 can be recovered from the Tinian Casino Gaming Control Commission as payment for improper travels made in fiscal years 1996 to 2001.

OPA also indicated that there is a potential recovery of $3.6 million that hinges on agencies’ actions.

Recommendations in eight audit reports identified potential recoveries of the amount due to unpaid rentals of land leases, uncollected labor processing fees, overpayments in professional services contracts and retirement benefits, and improper expenditures of public funds.

“Of the $4.7 million identified as potentially recoverable, $1.054 million has been partially recovered, leaving a balance of $3.671 million still recoverable as of Dec. 31, 2010,” OPA said.