Auditors tracked management issues central to large tax and finance agencies and did not cite actions deemed unlawful or unethical. In addition to the employees’ ability to change computerized tax records, auditors found problems related to sending tax bills, refunds and other documents to incorrect addresses. A third report cited Gandhi’s Office of Finance and Treasury — which is separate from the tax office — for failing to track wire transfers to city contractors, among others.
Until this week, none of the reports had been made public. They were among a handful that Gandhi’s former internal affairs chief, William J. DiVello, said were lingering in draft format, in one case since January. Gandhi’s agency has said that draft reports are exempt from public disclosure.
Gandhi’s spokesman, David Umansky, on Friday disputed DiVello’s account, saying that all three reports were final. “Absolutely no report ever idled in draft,” he said. “Nothing was ever held up once they finished the report. Nothing was ever suppressed.”
Umansky said the agency is undertaking a series of steps to correct the issues auditors cited. He said that years ago, Gandhi created the agency’s auditing arm, the Office of Integrity and Oversight, to look into weaknesses and suggest changes.
“Their purpose was to find things that needed to be fixed,” he said. “If there was no OIO, many of these things would not have been found. We’re being tarred for doing a good thing.”
Besides the newly released audits, The Post this month identified about a dozen additional internal reports that have been critical of the tax office in the five years since a mid-level manager was caught stealing $48 million through fraudulent refunds, the largest embezzlement scheme in city government history. All of the reports were final but had not been publicized. Gandhi’s agency has said that internal audits are generally not released because they could be used as a road map by employees with nefarious intentions.
Council member Jack Evans (D-Ward 2), chairman of the Committee on Finance and Revenue, said Friday that he was glad the audits were being done and will now be made public under legislation that the D.C. Council approved Tuesday.
“The follow-up question is whether they’re fixing the problems,” he said. “I want to make sure they’re doing that.”
The report that documented weaknesses related to computerized tax records, sent to Gandhi by his internal auditors in August, focused on “out-of-statute” refunds for individual and corporate franchise taxes.