Durham disputes campaign finance violations, criticizes state law
In a formal response to a Registry of Election Finance audit that found 690 potential violations of state campaign finance laws by former Rep. Jeremy Durham, the ex-legislator’s lawyer, Peter Strianse, and unnamed advisors offer explanations for some matters, generally deny any wrongdoing and criticize the laws involved.
WSMV has text of the document HERE. The Tennessean has a more lengthy narrative report on the 235-page response. An excerpt:
Comptroller: TN county governments haven’t been fouling up finances as much lately
News release from Office of the State Comptroller
Tennessee Comptroller Justin P. Wilson is pleased to announce that all 95 Tennessee county audits for the fiscal year ended June 30, 2016 have been released, and the results are very encouraging.
“We continue to see a decline in the number of audit findings across the state of Tennessee,” said Justin P. Wilson. “This is a sign of improved financial management and accountability over taxpayer money.”
The Comptroller’s Office completes the annual audits of 89 of Tennessee’s 95. The other six counties (Davidson, Hamilton, Knox, McMinn, Shelby and Washington) are audited by private Certified Public Accountants.
Comptroller catches government thieves in Claiborne, Fayette, Jefferson, Sumner counties
The ever-vigilant state comptroller’s office reports finding thievery afoot at Powell Valley Elementary School in Claiborne County, the city recorder’s office in the Sumner County city of Gallatin, a parks office and a school system Fayette County and at the New Market Volunteer Fire Department in Jefferson County in recent auditing of local government entities.
There are also “several questions” about activities at the town of Oakland in Fayette County generally along with the indictment of an official who worked both for the town and as athletic director of Fayette County schools.
Comptroller finds more missing money in DHS nutrition programs
News release from state comptroller’s office
Comptroller Justin P. Wilson has released investigations detailing serious issues within two organizations working under the Tennessee Department of Human Services’ Child and Adult Care Food Program and Summer Food Service Program respectively.
The Comptroller’s Office worked in conjunction with the U.S. Department of Agriculture, Office of Inspector General in its investigation of All About Giving, Inc. All About Giving, a nonprofit organization formerly located in Nashville and Knoxville, assisted daycare homes by submitting meal reimbursement requests to DHS for meals provided to children.
Investigators questioned several large cash withdrawals and expenditures made by All About Giving. Questionable expenditures included money spent on Xbox, Google Live, Big Fish Games, Shoe Carnival, Perfume Paradise, and in-state and out-of-state hotel charges. Investigators analyzed $230,569.33 of expenditures and found documentation to support only $19.60 for postage stamp purchases.
Audit catches city recorder stealing $32K
News release from the state comptroller’s office
An investigation by Tennessee Comptroller Justin P. Wilson and the Tennessee Bureau of Investigation has found that former Samburg city recorder Mary Swain stole at least $31,759 of public money.
Mary Swain was responsible for collecting money on behalf of the city, and Comptroller investigators found that she failed to deposit at least $14,471 of the cash she received for property taxes, garbage pick-up, and other city services. In fact, during the period July 1, 2013, through September 30, 2014, with the exception of fire protection fee collections, Swain deposited only $85 of the cash she received.
More on Durham audit — up to 500 violations, June hearing set
From The Tennessean’s overview story:
Former state Rep. Jeremy Durham violated state campaign finance law possibly as many as 500 times, including spending more than $10,000 of campaign funds illegally to buy an airplane ticket for his wife, custom suits, spa products and sunglasses, according to a state campaign finance audit released Wednesday.
He also used campaign money for more mundane bills, including lawn care and paint for his home office, the audit shows.
Durham made at least 55 illegal purchases using money given by donors; the state report outlines 39 expenses, but some include multiple purchases. The former Franklin lawmaker also used campaign funds to invest more than $100,000 in the company of a wealthy GOP donor, loan nearly $30,000 to a professional gambler who has a criminal past and loan $25,000 to his wife, auditors found.
Durham paid himself $7,702 from his campaign account for expenses he’d already been reimbursed for by the state, according to the audit. The practice is more commonly known as double-dipping.
…In addition to the illegal use of campaign finances, the audit details how Durham invested more than $100,000 in Life Watch Pharmacy, a company owned by Andrew Miller, a prominent Republican donor who has advocated for anti-Islam policy in the state.
…The report also states David Whitis, a professional gambler who has a criminal record, received three checks totaling $29,800 from Durham’s campaign account…Two of the checks to Whitis indicate the funds are a “loan to friend.” Additional information provided to the auditors by Durham states the money was “capital for a startup venture.”
Durham’s attorney has a “laundry list” of objections to the findings. Peter Strianse also says he thought the report was a draft that would not yet be distributed widely.
“I understand if that’s they’re procedure and those are the steps we have to go through,” says the lawyer. “But why in the world would you make public a report that you know is going to be subject to significant challenge?”
But a Registry official says the office followed standard protocol.
Durham’s attorney has until May to respond to the findings, before a hearing slated for June.
The Franklin Republican was expelled from the legislature last year following nearly two dozen anonymous claims of sexual harassment.
A federal investigation into potential campaign finance violations is ongoing.
Registry audit finds multiple campaign finance violations by Durham
The Registry of Election Finance staff today released its audit of former state Rep. Jeremy Durham’s campaign disclosures at a meeting of the Registry board. Here are the top-listed findings:
1. Jeremy Durham violated T.C.A. §2-10-105(a) and T.C.A. §2-10-107(a)(2)(A) by failing to report $36,334.95 in campaign contributions.
2. Jeremy Durham violated T.C.A. §2-10-105(a) by reporting $4,600 in contributions where the associated funds cannot be identified as being deposited into a bank account.
3. Jeremy Durham violated T.C.A. §2-10-105(a) by failing to report $10,623.70 in interest earned on campaign funds and T.C.A. §2-10-114(b)(1) by depositing $1,637.50 of that interest into his personal account.
4. Jeremy Durham violated T.C.A. § 2-10-302 by receiving $5,500 in contributions over the campaign limits.
5. Jeremy Durham violated T.C.A. §2-10-105(a) by reporting $6,500 of contributions intended for PACs he controlled as contributions to his campaign account.
6. Jeremy Durham violated T.C.A. § 2-10-107(a)(2)(A) by failing to accurately disclose the names of several contributors. 7. Jeremy Durham violated T.C.A. §2-10-105(a) and T.C.A. § 2-10-107(a)(2)(B) by failing to accurately report campaign expenditures.
8. Jeremy Durham violated T.C.A. §2-10-114 by disbursing $10,176.35 in campaign funds for prohibited activities.
9. Jeremy Durham made cash withdrawals and reimbursements to himself in the amount of $11,927.43 from campaign funds without support which is a violation of T.C.A. §2-10-114(b)(1).
10. Jeremy Durham reimbursed $7,702.07 in expenses to himself from his campaign account that were also reimbursed by the State of Tennessee which is a violation of T.C.A. §2-10-114(b)(1).
11. In violation of T.C.A. §2-10-212(c), Jeremy Durham failed to retain sufficient expense records to determine whether all expenditures were allowable.
12. Jeremy Durham disbursed $64,800 for promissory & convertible note activity which appears to be unallowable per T.C.A. §2-10-114(b)(1).
The full report is available by clicking on this link: durhamaudit
TN State Museum being audited — again
The Tennessee State Museum is under audit for the third time since 2011, reports The Nashville Post.
Deputy Director Mary Jane Crockett-Green sent an email to members of the Douglas Henry State Museum Commission confirming the audit, although at least six people from the Comptroller’s office started their work the day before.
“In Chairman [Tom] Smith’s absence due to travel, I have been asked to inform you that the Office of the Comptroller of the Treasury has scheduled an audit of the State Museum for the period of January 1, 2016, through December 31, 2016,” Crockett-Green wrote. “In addition to re-examining the Museum’s internal controls and confirming that all statutory requirements are being met, one of the primary objectives of the audit is to ensure that the corrective actions to mediate past Findings are being appropriately implemented.”
The new audit follows months of extensive reporting by the Post on the troubled agency and its apparent lack of oversight by the state commission entrusted with those duties — and it follows two highly critical audits in January 2011 and September 2015. In addition to new problems, the latter audit found the museum had still not implemented several procedural changes deemed necessary by the former one.
Audit finds fault with some aspects of state outsourcing
A new audit of the Department of General Services by the state Comptroller’s office finds some shortcomings but is less critical of Tennessee’s outsourcing efforts than in a 2013 review, reports the News Sentinel.
Policies since adopted have resolved most of the previously cited problems, the new audit says, but auditors still found fault with oversight in privatization by the department’s division known at State of Tennessee Real Estate Asset Management or STREAM. A list of “findings” that were deemed troublesome by the auditors:
“STREAM executive leadership did not establish adequate processes, did not maintain updated policies and procedures, and did not provide adequate direction to staff related to leasing processes.” In general, the issues involved failure to keep track of leases, related documents and building owner compliance with terms of the leases.
“When executing lease procurements, STREAM management did not comply with State Building Commission policy or department policies and procedures.” The neglected policies included obtaining and filing conflict-of-interest disclosures and renewal of leases involving a period of more than five years or a value and/or $150,000 in value without getting official commission approval.
“STREAM’s lease management team failed to effectively track and address the state’s leases before they expired.” In a sample of 25 leases reviewed, the auditors found that in 13 cases STREAM did not review renewals and simply defaulted to a “holdover” clause in the existing lease. In six cases, STREAM had no communication with the state agency using the leased building prior to an automatic renewal.
“STREAM management did not always ensure Jones Lang LaSalle submitted all monthly reports and performed property inspections as required by the facilities management contract.” The contract with JLL calls for the company to physically inspect each building every three months if it covers more than 20,000 square feet of space; annually if less than that. In a majority of cases, the deadlines were missed, auditors said, by anywhere from as little as 10 days to as much as 957 days.
The auditors also surveyed officials of state agencies that used leased building and found that a majority declared themselves satisfied with arrangements and many complimented JLL on its handling of issues raised.
Note: The full audit is HERE.
Comptroller: TN taxpayers losing money on $200 million TNInvestco program
News release from state comptroller’s office
A performance audit from the Tennessee Comptroller’s Office has revealed the State of Tennessee has only recovered $5.3 million of its initial $200 million investment in the TNInvestco program.
The TNInvestco program, which started in 2009 and 2010, is described as a public-private venture capital program intended to help start-up companies create jobs and for the state to eventually receive a return on its investment. As of December 31, 2015, the State of Tennessee has only received 2.6% of the initial investment.
The TNInvestco program will continue until 2021, and the state should recoup more of its investment; however, the department will likely not receive a return nearing $200 million. Although state law does not require any level of recovery, auditors recommend the Department of Economic and Community Development (ECD) regularly report the amounts returned to the program to the public and the Tennessee General Assembly.
