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San Diego City Auditor Busts Scrap Metal Scheme
The San Diego city auditor says he has busted a scheme in which employees of a division of the City’s General Services Department sold scrap metal from city projects for $5000 and spent $3000 of the cash to buy raffle items for a 2009 safety awards banquet. “Typically, the proceeds from the sale of scrap would be put into the safe and then used to fund recognition ceremonies,” according to a report posted on the auditor’s website. “A supervisor stated that there are no formal written procedures for the inventory and sale of scrap metal. The supervisor stated that there was no procedure for the collection and/or removal of scrap metal from the jobsite and that there were no controls over scrap metal for the division.
“In December 2009, an employee recycled scrap metal and received payments of $488.65 and $4,649.05. The scrap was salvaged from various City jobsites. The employee received a check, cashed the check, withheld $16 which he reported was provided to the yard workers as a tip, and transferred $5,122 in cash to another employee who was the committee chairperson. The committee members utilized the proceeds from the sale of scrap metal to purchase the food, decorations, and raffle gifts for the banquet.”
The report added that “raffle prizes included TVs, GPS devices, Blu-Ray DVD players, iPods, gifts cards, cameras, game consoles, etc. No record of the results of the raffle was located.” According to the report, “The records maintained by staff did not reconcile with the information received from the employees and recyclers, so it is not known if the proceeds of all scrap metal recycling transactions were utilized for employee recognition or diverted for personal gain.” As a result of the investigation, which was conducted after a tip to the City’s fraud hotline, the auditor made “six recommendations for the General Services Department to manage and monitor scrap metal, especially for the most valuable metals such as copper,” which the department agreed to implement.
Here's something you might be interested in.
San Diego City Auditor Busts Scrap Metal Scheme
San Diego City Auditor Busts Scrap Metal Scheme
The San Diego city auditor says he has busted a scheme in which employees of a division of the City’s General Services Department sold scrap metal from city projects for $5000 and spent $3000 of the cash to buy raffle items for a 2009 safety awards banquet. “Typically, the proceeds from the sale of scrap would be put into the safe and then used to fund recognition ceremonies,” according to a report posted on the auditor’s website. “A supervisor stated that there are no formal written procedures for the inventory and sale of scrap metal. The supervisor stated that there was no procedure for the collection and/or removal of scrap metal from the jobsite and that there were no controls over scrap metal for the division.
“In December 2009, an employee recycled scrap metal and received payments of $488.65 and $4,649.05. The scrap was salvaged from various City jobsites. The employee received a check, cashed the check, withheld $16 which he reported was provided to the yard workers as a tip, and transferred $5,122 in cash to another employee who was the committee chairperson. The committee members utilized the proceeds from the sale of scrap metal to purchase the food, decorations, and raffle gifts for the banquet.”
The report added that “raffle prizes included TVs, GPS devices, Blu-Ray DVD players, iPods, gifts cards, cameras, game consoles, etc. No record of the results of the raffle was located.” According to the report, “The records maintained by staff did not reconcile with the information received from the employees and recyclers, so it is not known if the proceeds of all scrap metal recycling transactions were utilized for employee recognition or diverted for personal gain.” As a result of the investigation, which was conducted after a tip to the City’s fraud hotline, the auditor made “six recommendations for the General Services Department to manage and monitor scrap metal, especially for the most valuable metals such as copper,” which the department agreed to implement.
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