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YSU employee accused of fraud, terminated
By Denise Dick
YOUNGSTOWN
A Youngstown State University employee was terminated, accused of committing fraud in the use of a university-issued credit card.
University police are investigating and no charges have been filed.
An internal audit report by Packer-Thomas Certified Public Accountants & Business Consultants, Youngstown, given to university trustees last week, said purchases were made for three books totaling $1,084.
“Our testing revealed that the estimated cost for these books should have been only $340,” the audit report said. “Upon further investigation, it was determined that an employee was committing fraud. In addition to his book purchase, there were other fraudulent purchases made of which a total amount has not yet been determined.”
The employee who made the purchases wasn’t the cardholder, but an assistant to the cardholder. The cardholder didn’t follow the university policies for card use. Cardholders aren’t permitted to authorize others to use their cards.
Dr. Sudershan Garg, chairman of YSU Board of Trustees, said any time there is an incident of fraud, it’s cause for serious concern.
“It’s being addressed through the audit, and we will tighten some of the rules for that so that fraud will not happen,” he said.
Trustees last week talked about training for the card use and instituting consequences for those who misuse them. Cardholders must have purchasing responsibilities within a department.
The incident was reported to police last September. Last November, Gene Grilli, then-vice president for finance and administration, sent a memorandum to those on campus who have the cards, reminding them of proper card usage and listing examples of noncompliance.
Examples of noncompliance:
Cardholders allowing their cards to be used as office or department cards. Each card is issued to one individual.
Reviewers are signing statements without reviewing, or not signing at all.
Cardholders are not reading emails.
Cardholders are submitting statements that lack account codes for each transaction.
A significant number of cardholders are late in reconciling and submitting statements to the controller’s office.
An “alarming number” of transactions lack supporting documentation.
Unallowed items are being purchased. “Examples of items considered personal include beverages and snacks, cleaning supplies ... refrigerators, microwaves, vacuum cleaners and water coolers,” the memo says.
Packer-Thomas warned of the problems in an internal report in January 2013.
The auditors applauded the university’s general accounting office for auditing procurement card transactions, but they said that doesn’t solve the problems.
“Users of the procurement cards should be retrained on how to use these cards and disciplinary actions should be taken when noncompliance issues are habitual,” Packer-Thomas wrote in the 2013 internal audit report.
“Additionally, we found that during General Accounting’s audit of the procurement card transactions, some purchases were deemed to be questionable, i.e. potentially personal in nature.”