In its latest semiannual report on the CNMI agencies’ implementation of recommendation, OPA reported recommendations in seven audits referred to AGO as of Dec. 31, 2010 involved potential recovery of $2,628,808 and $3.67 million from various CNMI agencies.
The OPA noted that AGO has yet to respond to its request for update on these referrals dated May 17, 2011 and no update has been provided that rendered these referrals’ status unchanged.
Of the $2.6 million that OPA found to be potentially recoverable, $1,315,102 were overpayments of professional service contracts.
It stated a balance of overpayments totaling $1,315,102 redirected to AGO of which $8,302 is “immediately recoverable if adequately supported”.
The report also included $739,346 in overpayments from Tinian Casino Gaming Control Commission.
OPA recommended legal action to recover $543,375 from the consultant for unjust enrichment, conversion, fraud, and breach of fiduciary duty.
It further called for recovery of $195,971 from three individuals for breach of fiduciary duty.
Another report dated Sept. 11, 2002 on the same agency’s Audit of Travel Transactions for fiscal years 1996-2001 stated a potential recovery of $392,178, a $17,747 reduction from $406,925 total outstanding advances.
A total of $100,000 is eyed as recoverable from $164,534 in improper payments made to a surveying contractor. This finding resulting from an audit of Department of Public Works in 2000 also called for adverse action against contractor for misrepresentation in the Tinian road resurfacing project in 1997. The report also indicated that the U.S. District Court reduced the amount for restitution.
Moreover, $4,982 has yet to be recovered from a former Rota Health Center director for an amount taken from the center’s funds including reimbursement for cost of washing machine covering a period from December 1993 to March 1996.
There is also on record $2,200 in loan receivable made to a CNMI constituent by the former Washington Representative and AGO indicated in the report that it would follow up with the Department of Finance if payment was made.
There is also a recommendation to look into $75,000 in misused funds by the former Secretary of Finance from 1995 to 1997.
Apart from these claims for recoverable monies, OPA referred to AGO for legal determinations three audit reports: Audit of the Compensatory Time Claimed and Retirement Benefits Paid to Two Former Officials of the Commonwealth Ports Authority, Audit of the Monthly Subsistence Allowance Provided to Members of the Senate.
In 2002, OPA referred to AGO determination on the propriety of CPA’s practice of making advance payments of unused annual leave and salary contrary to what was indicated in the contracts that payments would be issued upon expiration of contracts. It also called for review of OPA’s opinion regarding granting of six designated officials 14 annual leave hours per pay period.
There was also an OPA recommendation for AGO to look into whether legislation should be introduced granting Senate authority for subsistence allowance, setting its amount, and certifying allowance as a public purpose.
The OPA stated that it referred this matter to AGO as OPA and Senate could not reach an agreement to resolve this.
Meanwhile, OPA stated in its semiannual report covering the period of July 1, 2010 to December 31, 2010 that recovery of the $3.67 million hinges on the various CNMI agencies’ actions.
These monies that could be potentially recovered were uncovered in eight audit reports.
The agency also acknowledged in its report receipt of updates from the Department of Public Lands and the Northern Mariana Islands Retirement Fund.
OPA reported that of the $4,726,434 identified as potentially recoverable, “$1,054,605 has been partially recovered leaving a balance of $3,671,829 still recoverable as of December 31, 2010.”
In the report provided by OPA, an audit of the Marianas Public Lands Authority indicated collection of rentals from eight quarry operators from 1990 to 1995.
Of the $4,690,708 in collectible rentals, there remains $3,743,740 yet to be recovered due to $946,968 written off rentals of one bankrupt operator.
It was also reported that $896,747 had been recovered from seven operators.
OPA pointed out too that incomplete ledgers provided left it unable to ascertain total amount collected from Quarry Operator A and F as of May 2011.
In an audit of the Department of Labor on controls over nonresident worker application process, a total of $512,410 was expected to be recovered.
These recoverable monies were $330,835 and $181,575 in uncollected fees from two companies. It was noted, however, by OPA that an ongoing investigation was nearly complete and DOL would inform OPA of developments.
There’s a report on the $126,730 in overpayments of retirement benefits and compensatory time claimed by two former CPA officials.
An overpayment to one official had been resolved with the recovery of $69,816.17 by the Retirement Fund.
This, OPA indicated in its report, leaves $56,913.83 in yet to be recovered monies.
Under MPLA, there were double payment of travel expenses and overpaid per diem allowances as of fiscal year 1995 amounting to $115,862.33: $27,743.74 (principal plus interest) to former board chairman; $71,289.14 (principal plus interest) to former Rota board member; $16,829.45 (principal only) to Tinian board member.
The latter had been reduced to $11,657 and was fully recovered in April 2011.
Of the $56,913.13 due from the former board chairman, only $5,925 had been recovered as of April 2011.
Of the $105,468.08 due from the Rota board member, $54,800 had been partially recovered as of June 4, 2011.
Meanwhile, there was an overpayment of two professional services for contracts covering a period from Oct. 1, 1991 to July 20, 1995 where a partial recovery of $14,000 had already been made yet $81,900 remains to be collected.
Under the Department of Finance, there was a report of the misuse of funds by its former secretary amounting to $56,462 that the federal court in Feb. 2002 ordered paid as restitution. Of this amount, $1,125 had been recovered.
Another $15,079 in overpayments on professional services was also in the books and the Department of Finance is consulting with AGO on appropriate course of action given statute of limitations and dearth of supporting documents.
These partially recovered monies totaling $1,054,605 leave a balance of $3,671,289 yet to be recovered as of Dec. 31, 2010.
The OPA has been maintaining a tracking system for all its audit recommendations.
Of the 46 recommendations it has tracked, six were closed while 40 remained open or resolved. Of the 40 open or resolved recommendations, 26 were considered delinquent.
According to OPA, recommendations are deemed open when no action has been made or no time frame for plan of action has been given by the agency.
A recommendation is closed when agency or client has taken sufficient action to meet intent of OPA’s recommendation.
It is resolved recommendation when OPA is satisfied that agency cannot take immediate action yet has established a reasonable plan and time frame of action.
If a recommendation has been outstanding for at least 180 days and OPA has not been apprised of the agency’s action, then OPA considers this as delinquent.
Although OPA included in its semiannual report the recommendations by independent auditors, OPA stated that it is not responsible for tracking these recommendations.
