Hundreds of Thousands of $$$ Stolen From City Hall Cash Register

[Honky Tonk]

rex

Well. Fortunately this is the exception instead of the rule. Top to bottom, city officials, employees, contractors and others allowed near the money never steal. Its a honest, ethical, savory group of individuals. Other municipalities should be so lucky.

There, I fixed that for you........

[Gistok]

... oh I don't know... I think Democratic pundit James Carville's analogy fits just about anywhere....

"If you drag a $100 bill thru a trailer park... you'd be surprised what sticks to it..."

Given a known lack of oversight... I think that many otherwise honest people might be tempted if there were no repercussions...

[Blueidone]

I am not familiar with Detroit's "cash register" system. Can someone inform me as to the process when someone goes to the counter? Do the clerks make entries into a computer about what the money is for and who is paying it? Or do the clerks simply make a written list of what is paying paid by whom?

As I said earlier, whoever is the supervisor in the department they are talking about should have put in place a system of checks and balances. If they are using a computer, at the end of the day a computer-generated report should be printed. Then the cash drawer should be counted...and NOT by the person or persons who use the cash drawer. The amount in the drawer should equal the amount on the report...end of story.

The handwritten list leaves too much opportunity for someone to make an error in entry, or to not make an entry at all.

This is not rocket science...it's Bookkeeping 101. I'm sure many of you remember the old pegboard bookkeeping systems that doctors used to use [[maybe some still do). It gave you a daily record of who paid what every day. Your cash [[ & checks ) should total the amount shown at the end of the day.

If the department supervisor didn't set up a system and instruct people how to use it, then that person needs to be replaced. EVERY department that takes in cash within the city should have the same kind of system. They should all be identical so that each employee knows how the system works, no matter what department are working in.

Again...NOT rocket science. It still makes me ill.

[Wesley Mouch]

So, instead of blaming the guy in office now, you want to blame the guy who left office almost twenty years ago. Okay.

...

But, hey, if you want to beat that "It's Coleman's fault" dead horse over and over, go ahead. It will feel good.

Ouch. That hurt. I sure didn't mean to excuse Bing and blame Coleman.

I don't think it was Coleman's fault. And I don't think its Bing's fault. Its the fault of years of bad decisions. In the past, when Joe Harris as auditor pointed out that Detroit's accounting procedures were woefully inadequate -- he was chased out of town. We hire a DPS emergency financial manager, and we can't wait to kick him out. The state wants to help. And we find a thousand absurd reasons like 'home rule' to fight it every step of the way.

The result of chasing away financial reform, is not financial reform.

Any decent audit procedure would have discovered this. But we preferred to chase away help. We got what we deserved.

So perhaps its time to welcome a strong auditor. Put out welcome mats. Policy statements from leaders that this kind of theft will be prosecuted. The only place I've heard that so far was from DPS emergency managers who have clearly said they will prosecute. And did. Bravo.

[Jimaz]

... As I said earlier, whoever is the supervisor in the department they are talking about should have put in place a system of checks and balances. If they are using a computer, at the end of the day a computer-generated report should be printed. Then the cash drawer should be counted...and NOT by the person or persons who use the cash drawer. The amount in the drawer should equal the amount on the report...end of story....

Totally agree. And if the cashiers change during the day they should reconcile the cash drawer at that time too.

I worked at a gas station as a kid with tighter rules than this. If any cash disappeared on your shift, you had no defense and had to make it up. Tracking this kind of stuff is simply a cost of doing business.

[Motor City Sam]

Ouch. That hurt. I sure didn't mean to excuse Bing and blame Coleman.

I don't think it was Coleman's fault. And I don't think its Bing's fault. Its the fault of years of bad decisions. In the past, when Joe Harris as auditor pointed out that Detroit's accounting procedures were woefully inadequate -- he was chased out of town. We hire a DPS emergency financial manager, and we can't wait to kick him out. The state wants to help. And we find a thousand absurd reasons like 'home rule' to fight it every step of the way.

The result of chasing away financial reform, is not financial reform.

Any decent audit procedure would have discovered this. But we preferred to chase away help. We got what we deserved.

So perhaps its time to welcome a strong auditor. Put out welcome mats. Policy statements from leaders that this kind of theft will be prosecuted. The only place I've heard that so far was from DPS emergency managers who have clearly said they will prosecute. And did. Bravo.

I agree with this. I would welcome such an auditor and prosecution of anyone found to be breaking the law and termination of those found to be breaking the rules. I wasn't a fan of everything Robert Bobb did, but I applauded his move of placing an ex -FBI guy in charge of rooting out corruption. I loved his idea of having people come pick up their checks in person to eliminate the "ghost employees". I wish the City had put those same things in place.

[Detwa]

I agree with this. I would welcome such an auditor and prosecution of anyone found to be breaking the law and termination of those found to be breaking the rules. I wasn't a fan of everything Robert Bobb did, but I applauded his move of placing an ex -FBI guy in charge of rooting out corruption. I loved his idea of having people come pick up their checks in person to eliminate the "ghost employees". I wish the City had put those same things in place.

That was pretty brilliant actually! The city and the schools need to do this at least once a year, on a surprise day - can't give advance notice or people will have time to grab fake documents. With direct deposit, any number of people can get away with a scam like this for a very long time.

[detroitsgwenivere]

The new charter already establishes new procedures for dealing with these financial accountability issues. The Auditor General now conducts annual, risk-based audits instead of a 2yr. audit review cycle, the latter of which is probably how this theft went undetected for so long. Well, besides the fact that audits during the Kwame years were late at least 5 audits in a row, while his office practiced their Enron accounting skills.

"Low risk agencies" would continue to be audited on a rotating basis, freeing up the office to pay closer attention to the larger departments, allowing them to isolate discrepancies in a more timely manner. But they will also have to complete an annual financial analysis focusing on any unusual transactions or losses.

We also have the newly established Office of the Inspector General, who's job is to investigate public servants, agencies and departments, or any business that is seeking or possesses any city contract. This would be the office that will narrow down the who's and how's of this missing 314k, whether its really a theft or just an accounting error, whether it's isolated or systematic, etc.

[Honky Tonk]

"The new charter already establishes new procedures for dealing with these financial accountability issues. The Auditor General now conducts annual, risk-based audits instead of a 2yr. audit review cycle, the latter of which is probably how this theft went undetected for so long. Well, besides the fact that audits during the Kwame years were late at least 5 audits in a row, while his office practiced their Enron accounting skills."

Well that raises a question in my mind. What's in place to prevent a department from stalling for 5 years and not submitting the required audit?

[detroitsgwenivere]

^^ The charter gives the IG access to all records, financial and otherwise, of all city agencies at any time. They also possess subpoena powers and the ability to enforce them, and can inspect any city office during regular business hours. If anyone who falls under the umbrella of "public" obstructs an IG investigation without justification, they can be subject to discipline, debarment, forfeiture of office, etc. Of course, the charter doesn't define what "justification" consists of.

The IG must also submit quarterly reports to the Mayor and Council, which contain the results of their audits and investigations, are also public record and should be online.

[Gistok]

I agree with Blueidone... this is every day common sense accounting... with checks and balances... Normal businesses don't wait for an audit to tell them something is amiss... neither should cities...

[Honky Tonk]

"The charter gives the IG access to all records, financial and otherwise, of all city agencies at any time. They also possess subpoena powers and the ability to enforce them, and can inspect any city office during regular business hours. If anyone who falls under the umbrella of "public" obstructs an IG investigation without justification, they can be subject to discipline, debarment, forfeiture of office, etc. Of course, the charter doesn't define what "justification" consists of.

The IG must also submit quarterly reports to the Mayor and Council, which contain the results of their audits and investigations, are also public record and should be online."

It sounds good if the IG is strong and gets serious about the task @ hand. If this is just lip service, and the good ol' boy, one hand washes the other club continues, it'll be yet another money hole created by the COD.

[detroitsgwenivere]

It sounds good if the IG is strong and gets serious about the task @ hand. If this is just lip service, and the good ol' boy, one hand washes the other club continues, it'll be yet another money hole created by the COD.

I agree. For the last year, there were job listings posted for the top position, so the city appears to have been looking outside the gov. pool. But if someone connected who just happened to fit the hiring criteria is the one turning over stones, he may just choose not to find anything under there.


Yes gistok, common sense point of purchase loss prevention measures are necessary and expected to prevent theft from happening in the first place. Most monetary transactions consist of a drawer till and computerized record keeping.

[Honky Tonk]

No offense, but the City talent pool seems to be rather shallow. I think they should seek outside professional help. Of course then you have the "our" thing going on with the locals.

[Wesley Mouch]

I agree with Blueidone... this is every day common sense accounting... with checks and balances... Normal businesses don't wait for an audit to tell them something is amiss... neither should cities...

Totally agree.

Failure to detect cash counter theft is nearly impossible -- unless you're entire corrupt or incompetent. Years ago, the city's auditor general, I think it was Harris, said that 1/3 of the city's payments didn't have proper backup. If you work for a privately held company as I did -- this would get you fired in moments.

The City has clearly lost its ability to function. The rot is so deep, that there' no sense in trying to patch anything. Does anyone else remember how the city spent untold millions making Compuware [[I think it was) modify its standard, off-the-shelf city government management software so it worked with their procedures? They refused or were unable to change their procedures to match the other 3,000 cities using the package. That money appears to be well spent if the modified software allowed a disadvantaged city worker to escape poverty.