D.C. Auditor Otis H. Troupe called yesterday for the removal of top city lottery officials Alex Exum and Chester Thomas from their jobs and said the board's executive director, Douglass Gordon, was "derelict in performing his duties" in connection with the agency's purchase of a video cassette recorder that it cannot account for.
Troupe said, in a report released yesterday, that Exum, the lottery board's executive assistant and marketing director, is "guilty of inexcusable neglect of duty" in the purchase of the $299 video recorder, that he made "numerous misrepresentations" to officials investigating the expenditure and that he should be fired from his $45,048-a-year job.
Troupe said an internal lottery board investigation of Exum's involvement in the purchase was "lackadaisical" and "incompetently performed," and that board security chief Thomas, who conducted the probe, should be reassigned to a less sensitive job. The auditor said Gordon had failed to take prompt action to resolve the matter.
"We note that the lottery board has consistently failed to monitor its expenditures and to institute checks and balances against the financial dealings of its staff members," Troupe said in the report. "We have also noted that the nature of the gambling industry requires that all employees, especially those in sensitive positions, be held to the highest standard of conduct."
Gordon, in a statement issued last night, said that the auditor's findings "have potentially grave implications" and that the lottery board has called in the city's inspector general to investigate the purchase.
Gordon criticized Troupe for making his report public before the board could resolve the issue. "This is not the first time the auditor has attempted to manipulate public opinion through the release of unsubstantiated allegations to the media," Gordon said.
Gordon added that the lottery board has been reimbursed for the purchase of the missing recorder. Sources said that Exum, who, according to Troupe's report, has told board officials that he did not receive the unaccounted for video recorder, reimbursed the board for the $299 on Monday.
Exum, reached yesterday, declined to comment on the report.
Questions about the purchase arose in early September when a lottery employe discovered that the board had been billed for the purchase of seven video cassette recorders, but only six of the machines could be accounted for. The machines were used as door prizes for those attending the lottery's grand-prize drawing in July, but six recorders, not seven, were given out.
Exum purchased the recorders from Graffiti Video and Electronics and told lottery officials that he received six, not seven recorders. However, according to Troupe's report, Exum signed invoices and payment-requisition forms calling for the purchase of seven recorders.
An attorney for the store, Gary Mininsohn, said in an interview last night that store records show that the lottery board ordered seven recorders and picked up seven.
The auditor's investigation of the missing recorder grew out of an inquiry into overall purchases made by the lottery board; preliminary findings show that there are "major weaknesses in the agency's procurement procedures," according to the report.
The report said that documentation justifying some lottery purchases was "weak or nonexistent" and that agency officials on numerous occasions initiated the purchase of items without determining whether funds were available and without the requests being scrutinized by lottery procurement officials.
Originally, the lottery board planned to give out five recorders as door prizes at its July 10 grand-prize drawing at the Washington Convention Center. On July 10, according to Troupe's report, Exum's staff prepared a purchase order for six recorders.
That same day, Troupe said, Exum visited Graffiti and signed a store invoice for six recorders. Troupe's report said Exum has told lottery officials that he only picked up five recorders and that he did not realize that the invoice was for six recorders until it was brought to his attention Sept. 7.
Exum said he brought the five recorders he picked up to the Washington Convention Center for the drawing, according to Troupe's report. However, a mix-up forced lottery officials to award six recorders as door prizes instead of five.
Exum then ordered another recorder for the unexpected sixth winner and picked it up at Graffiti on July 12, according to Troupe's report -- making a total of seven he had purchased.
On Aug. 16, according to Troupe, Exum signed two payment-requisition forms, one authorizing the board to pay for six recorders and another authorizing payment for the seventh.
Troupe criticized Thomas, the security chief, for failing to verify Exum's account, for not interviewing several key witnesses and for ignoring important documents in a report he prepared on the matter.
Troupe said that Gordon received Thomas' report on the purchase on Oct. 2 and said that Gordon was derelict in his duties because, as of Monday, "he had taken no action in response to the report."
Gordon said that the board has a responsiblity to make sure all the facts are known before it takes final action.