Audit of California Lottery finds over $305,000 in improper or dubious spending

Audit of California Lottery finds over $305,000 in improper or dubious spending

California Lottery officers tallied greater than $305,000 in improper or questionable spending over the ultimate 4 years that incorporated go back and forth, meals, items to workers and leisure bills, a state audit concluded Tuesday.

Among the improper bills, the lottery company spent $21,666 to present workforce logo-branded swag similar to T-shirts, backpacks, lip balm and iPad circumstances, labeling the purchases “learning aids” and “training tools,” consistent with the audit via state Controller Betty Yee.

The monetary evaluate was once introduced after rank-and-file workers of the lottery complained in an nameless letter despatched to Gov. Jerry Brown in August and right through testimony at public hearings that managers had did not regulate spending and had allowed irrelevant behavior at gross sales workforce occasions.

“Lottery management’s lenient oversight and disregard for policies and procedures allowed for more than $300,000 in prohibited and questionable costs,” Yee stated in a observation. “Clearly, Lottery management needs to overhaul their internal controls and enforce state policies.”

Yee’s evaluate is solely the primary investigation finished after workers went public with proceedings that incorporated an alcohol-fueled birthday party at which a supervisor allegedly put his head throughout the shirt of a feminine worker. The state Department of Justice may be taking a look at allegations of mismanagement, nepotism, cronyism and favoritism via company officers.

The California Lottery’s control reviewed the audit and “generally agrees with its findings and recommendations,” the company stated in a observation, including that “Lottery Sales Division management could have done a better job tracking and documenting expenses and minimizing administrative errors.”

An inside evaluate of the problems has already resulted in corrective motion, the company stated in its observation, noting that its “staff is receiving updated training to ensure awareness of, and compliance with, all state regulations and rules.”

The state lottery was once created when California citizens licensed Proposition 37 in 1984, with a portion of proceeds going to schooling. The audit comes at a time when the lottery is atmosphere gross sales information: The company equipped $6.2 billion to public faculties right through the four-year duration lined via the audit, officers stated.

“Our audit found that the Lottery lacked adequate controls, including policies and procedures” for go back and forth bills, together with the ones in an $Eight-million revolving fund for bills, the audit concluded.

“In addition, policies and procedures were not followed as a result of the Sales Division’s directives and poor oversight,” the audit document stated.

Auditors known $240,934 in unallowable prices and $64,088 in wondered prices. The unallowed prices incorporated $131,832 in irrelevant or pointless worker go back and forth bills for gross sales department workforce occasions.

Improper bills incorporated $83,411 in lodge prices billed via workers in spite of a coverage in opposition to such remains when a employee lives inside 50 miles of an tournament.

“We identified one employee who lived only six miles from the conference but stayed at the hotel for three nights, costing $536,” the audit stated. Lottery officers additionally overbooked rooms, ensuing in cancellation and attrition charges of $12,731.

In addition, gross sales managers claimed over the top mileage compensation for commutes to the place of job via making transient stops at retail places and claiming they had been required via their task, the audit discovered. In one case, auditors stated a supervisor had $13,280 in unallowable mileage prices.

The audit additionally stated $16,738 was once improperly spent on food and drink at a non-mandatory after-hours meet-and-greet tournament with an company contractor.

In an e mail to workers, Lottery Director Hugo López wrote that Yee’s place of job “did not discover any instances of fraud as had been alleged in the anonymous letter.”

The company drew grievance from 27-year veteran lottery employee Tom Weber, a union steward who was once one of 5 workers who complained about mismanagement in testimony to the Lottery Commission in September.

“The lottery, as usual, is downplaying a much more serious problem,” Weber stated. “They are sweeping it under the carpet.”

Updated: April 11, 2019 — 6:52 pm

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