Forensic Review Finds no Evidence of “Wrongful or Illegal Activities”; Cost Controls Tightened
July 26, 2005
The latest in a series of investigations into allegations of improper conduct at the City of Richmond’s Roads Department has found no evidence “indicating wrongful or illegal activities occurred” despite inadequacies in cost controls at the time in question. After conducting a forensic review of records pertaining to the allegations of over billing, independent auditors Grant Thornton advised Richmond City Council that no further action is recommended.
Since 2003, the City has instigated a number of investigations into allegations of improper conduct in the Roads Department, during a period from 1999 to 2001. These include allegations of favouritism in the hiring of external equipment contractors, over billing for rental equipment and falsifying timesheets to inflate overtime claims. Related allegations of workplace harassment have also arisen.
When first notified of these allegations, the City immediately began a series of informal and formal reviews. These include internal and external reviews, an RCMP investigation and a review of Public Works accounting practices and records by City auditors KPMG. The RCMP and auditors found no evidence to support criminal charges or internal disciplinary action.
Facing continuing criticism, the City appointed an independent panel earlier this year to review its handling of the original allegations and subsequent investigations. Council received the panel’s final report in early July. Based on the panel’s recommendations, the City immediately contracted independent auditors Grant Thornton to again review records related to the allegations of improper conduct.
As a result of this review, Grant Thornton reported that a series of cost “control weaknesses” existed during the period in question. “These control weaknesses provide for the possibility that the alleged activities or inconsistencies could have occurred,” the auditors concluded, adding, “Notwithstanding that GT’s review of the documentation available highlighted the control weaknesses present, no evidence was identified in our review indicating that wrongful or illegal activities occurred.” Accordingly, Grant Thornton recommended no further action be taken.
Since the period in question, the City has made numerous and substantive changes to internal controls throughout its Public Works departments. In addition, the City has been conducting and is committed to continuing reviews of its financial practises, as a regular course of operations, to ensure accountability throughout the entire organization.
“We have investigated this matter exhaustively,” said Mayor Malcom Brodie. “We are certainly very concerned about the insufficient cost controls that were in place at the time. However, we are confident that we have fixed that problem. Following these reports Council is satisfied that the allegations have received a fair hearing and is confident that the reforms already implemented or now underway will be sufficient to address any of the problems the City has identified.”
The independent panel also made extensive additional recommendations on improving Works Yard operations and workplace culture. Acting on Council’s direction, an extensive public information package has now been released, which outlines the panel’s findings and recommendations and the City’s plans for further action.
Attachments:
Works Yard Review - Panel Review Overview
