Columbus – Sketchy payments and poor records at the Carter G. Woodson Institute (Montgomery County) led to $168,772 in findings for recovery, according to the school’s closeout audit released today by Auditor of State Dave Yost.
On June 15, 2010, Treasurer Ed Dudley withdrew $63,180 from the school’s bank account and issued 18 bonus checks for employees, valued at $3,500 each. The board did not approve the bonuses; in fact, an emergency board meeting held December 17, 2009 approved a 20% pay cut for faculty and staff.
After further review, a comparison of employee contracts to gross salaries found that 16 employees were actually overpaid by an additional $16,712, for a total of $79,892. Findings for recovery were issued against the employees for the amounts that they were overpaid. Treasurer Ed Dudley is held jointly and severally liable for the full amount.
CEO Shane Floyd made seven withdrawals from the school’s general operating and payroll checking accounts in the total amount of $31,383. There was no documentation to support the withdrawals and no board approval. A finding for recovery in the amount of $31,383 was issued against Floyd, and Treasurer Ed Dudley is held jointly and severally liable.
In August 2009, the school switched treasurers from Carl Shye to Ed Dudley, an employee of LED Consulting. No information was provided to prove the new treasurer contract was approved by the board. An unsigned copy of the treasurer’s contract stated that the treasurer would be paid $4,000 per month. Based on this contract, LED Consulting should have been paid $44,000 for 11 months of work. However, LED Consulting was paid $57,400 for treasurer/accounting services. A finding for recovery in the amount of $13,400 was issued against LED Consulting.
“Looks like we went from one lousy treasurer to another,” Auditor Yost said. “And it’s the taxpayers who suffer.”
Ed Dudley served as the school’s treasurer from August 1, 2009 to June 30, 2010, while also serving as president of LED Consulting. During that time, LED Consulting loaned the school $16,000, however, the school paid $17,000 in loan payments. An additional $10,000 payment to LED Consulting lacked documentation to explain the reason for the expenditure. A finding for recovery in the amount of $11,000 was issued against LED Consulting. This finding was referred to the Ohio Ethics Commission.
On December 15, 2009, the school issued a $12,000 check to Carl Shye. Two invoices indicated that $6,000 of the payments were for monthly internal auditor fees, but there was no indication that the school had these functions or that the board approved the services. There was no documentation for the remaining $6,000 to support the payment. A finding for recovery in the amount of $12,000 was issued against Shye, and Treasurer Ed Dudley is held jointly and severally liable.
Carl Shye will be arraigned on an embezzlement charge on Thursday, June 21 at 10:00 a.m. at the Joseph P. Kinneary U.S. Courthouse in Columbus.
A full copy of this audit may be accessed online.
The Auditor of State’s office, one of five independently elected statewide offices in Ohio, is responsible for auditing more than 5,600 state and local government agencies. Under the direction of Auditor Dave Yost, the office also provides financial services to local governments, investigates and prevents fraud in public agencies and promotes transparency in government.