D.C. Hearing On Scandal Has Gandhi In Tight Spot

Gandhi and the interim tax office director, Ben Lorigo, have said that the scheme was elaborate and that they probably would not have detected it without a tip. Some council members dismissed that defense yesterday, pointing to the warnings from Nichols.

Lorigo, who was in charge of oversight and integrity, also came under fire yesterday. He told the council that he had not done an audit of real property taxes in his five-year tenure. "If there is no confidence in my ability to do it, I will resign immediately," he said.

Hobbs Newman arrived at the council chambers flanked by supporters, including her husband, Robert P. Newman, former director of parks and recreation, who resigned in 2000 after his management skills were criticized and he was accused of embellishing his résumé.

In her written testimony, Hobbs Newman said her "body of accomplishments far exceeds the missteps I have made." She said she was in the process of improving the checks and balances in the office when she was forced to resign.

"Why did we not uncover it? My answer is short and simple. I was not looking for it," she said. "During the 25 months that I was deputy CFO, I worked aggressively and quickly to resolve the problems that were brought to my attention while at the same time beginning to identify and fix weaknesses in the controls and systems, and all the while, doing the normal business of our agency."

Plans were in place to reorganize the tax office and assessment services division, and new policies and procedures were going to become effective next month, she said.

"By the end of this year, this area would have seen supervisory changes, staffing changes and process changes. I cannot say this emphatically enough, I truly believe these improvements would have shut this operation down," she said.

Staff writer David Nakamura contributed to this report.