/ Articles / State fraud hotline tops 1,100 tips since 2008

State fraud hotline tops 1,100 tips since 2008

July 23, 2019 by Richard Moore

The state Legislative Audit Bureau (LAB)’s fraud, waste, and mismanagement hotline has collected more than 1,100 tips since its inception 11 years ago, a clip of about 100 calls per year, the LAB reported this week in a semi-annual report to the Legislature.

Since Jan. 1, the LAB report stated, the hotline received 35 calls.

According to the LAB, the hotline provides the public and state government workers with a means to confidentially report potential fraud, waste, and mismanagement in state agencies or programs, including within the UW-System and the Wisconsin Technical College System.

At the request of state Sen. Robert Cowles (R-Green Bay) and Rep. Samantha Kerkman (R-Salem Lakes), the co-chairpersons of the Joint Legislative Audit Committee, the LAB now reports semi-annually on hotline activity.

“Getting the information from the fraud, waste, and mismanagement hotline on a more frequent basis will allow the audit committee and its co-chairs to more rapidly consider issues of waste, fraud, and abuse in state government,” Cowles said. 

Since inception through June 30, 1,133 reports were made to the hotline, the audit stated. From January 2019 through June 2019, the LAB says it received 35 hotline reports, 26 of which were specific to state agencies or programs and involved a variety of topics, including agency mismanagement, improper oversight of state funds, and waste or inefficiency in state government. 

When people call the hotline, they may remain anonymous, the LAB report stated, and statutes specifically require the agency to protect their identities even when other information related to calls is made public. 

A secure online form is also available to report concerns and is available at http://www.legis.wisconsin.gov/LAB/, the report stated.



This year’s reports

Of the 26 calls received so far this year related to state agencies or programs, the LAB had resolved five of the 26 reports to the hotline, either directly or by referral, and determined that four reports were unfounded, unsubstantiated, or required no action. In addition, the agency stated, 17 of the 26, or 65.4%, state-related hotline reports remained under review as of July 1.

One of the more significant cases involved contracts for technical college course credits, the LAB found.

“Based on a report made to the hotline, we completed a review of certain contracts between the Waukesha County Technical College (WCTC) and a private business for technical college course credits granted to high school students,” the report stated. “We reported the findings from this review in May 2019 as report 19-8.”

Based on available records of educational services provided involving a private business, the LAB estimated that WCTC did not collect at least $121,440 from 2015 through 2017 because it did not enter into statutorily required contracts or did not collect revenue from a contract it executed. 

“We recommended WCTC take steps to ensure that it consistently enters into statutorily required contracts with private businesses when it provides educational services or permits its curricula to be used in awarding technical college course credits,” the report stated

Over at the Department of Veteran Affairs, the LAB found compliance issues with state travel policies.

“Based on a report made to the hotline, we completed a review of travel reimbursement procedures at the Department of Veterans Affairs (DVA),” the report stated. “Specifically, we received a hotline report alleging noncompliance with state travel policies.”

For example, the report stated, one employee consistently used one hotel chain and airline for which the employee participated in rewards programs. 

“Under state policies, rewards earned through state travel should be used to offset future travel costs for state business,” the LAB stated. “However, we found no evidence that participation in these rewards programs was used to offset subsequent DVA travel costs before the employee left DVA employment.”

Though DVA followed Department of Administration (DOA) policies in limiting the lodging reimbursements to the maximum amount allowed, the report continued, it did not document that the airline selected by the employee offered the lowest appropriate airfare.

“We also found DVA’s policies to be insufficient to prevent potential noncompliance by other employees,” the report stated. “In June 2019, we recommended that DVA revise its policies and procedures to comply with DOA travel policies; develop a process to ensure that employees have identified and documented the lowest appropriate airfare for state business travel prior to incurring travel costs; and provide training for its employees.”

Finally, in a minor issue, the LAB referred an allegation about cellular phone use to the University of Wisconsin-La Crosse. 

“Specifically, we received a hotline report that alleged two UW-La Crosse employees had each been assigned a UW cellular phone and both employees consistently used the phone for personal use,” the report stated. “ … UW-La Crosse’s review found that the two employees regularly used their UW-issued cellular phones for personal phone calls, and it determined that one of the two employees no longer needed a cellular phone for their job responsibilities.”

However, the report continued, because the UW policies do not expressly prohibit personal use and the additional calls did not result in additional costs, UW-La Crosse took no further action related to the personal calls. 

“Based on its review, UW-La Crosse also assessed its current procedures for reviewing the business need for issuance of UW cellular phones and indicated its plans to conduct periodic reviews in the future,” the report concluded.

Kerkman urged people to continue using the hotline.

“The hotline is a great way for the public and government employees to help their elected officials and the audit bureau become aware of government waste, fraud, and abuse,” she said. “We encourage people to use the hotline to let us know about ways government operations can improve.”

Individuals may report concerns related to state government activities to LAB by calling the toll-free hotline at 1-877-FRAUD-17, through a secure online reporting form available at www.legis.wisconsin.gov/lab/hotline, or by mail.

Richard Moore is the author of the forthcoming “Storyfinding: From the Journey to the Story” and can be reached at richardmoorebooks.com.

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