Barras: Parties, secret audits and D.C.'s finance chief

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Local,DC,Jonetta Rose Barras

Recent troubles inside Chief Financial Officer Natwar Gandhi's operation may seem new. But, they are more of the same, underscoring this fact: The CFO has mismanaged his $127 million independent agency for years.

Management letters that accompanied the city's last three comprehensive independent annual audits cited weaknesses or serious deficiencies in the internal controls of departments under the CFO's authority, including the Office of Tax and Revenue and the Treasurer. In 2011, auditors said conditions at the OTR remained ripe for theft. Then, there is the fact that Gandhi failed to collect certain mandated recordation taxes. He also has permitted agencies to overspend their appropriated budgets. Still, the legislature voted this summer to confirm Mayor Vincent C. Gray's appointment of Gandhi to another five-year term.

Lickety-split the consequences of that decision splattered their collective face.

District taxpayers soon learned another $300,000 of their money had been stolen from the OTR. The Washington Post reported the CFO had withheld -- from everyone -- internal audits critical of his operation. That prompted the federal Securities and Exchange Commission to open a "confidential informal inquiry" of the CFO, requesting audits, correspondence and emails dating back to 2010.

A house of cards eventually falls.

As someone who has often written critically about the CFO, I was not surprised by those revelations. But, I was amazed by this: Even when Gandhi knew the media were about to disclose the shenanigans going on in his operation, including dramatic reductions in assessments of commercial properties, he was impervious.

Gandhi threw himself a party at that swank Metropolitan Club, where he is a member. Sources said he spent his own money. He didn't respond to my requests for comment.

Some of the individuals who attended the shindig often do business with the city, raising questions about the appropriateness of such an event. The CFO and his staff are ultimate deciders of who gets paid and when. They write the checks. Yet, a spokesman for the city's attorney general and the ethics board chairman said Gandhi did not consult them to determine whether his party might constitute a conflict of interest or the appearance of one.

Gandhi's sense of invincibility and continued mismanagement of his agency emanate from the absence of rigorous council oversight. The executive branch, including the CFO, performs only to the level expected and demanded by the legislature and the public.

Some legislators may lack the acumen for a deep dive into the CFO's shop. But Jack Evans, chairman of the Committee on Finance and Revenue, is a Wharton School graduate and a former SEC staffer. He has been charged with CFO oversight for a decade.

Why have the media discovered critical issues, and not him and his committee? Is his relationship with the CFO too cozy? Is it time to change committee leadership?

When I asked Evans those questions, he called his oversight "exemplary. I would challenge anyone to say they could do a better job than I am doing."

Anyone care to respond?

Jonetta Rose Barras can be reached at jonetta@jonettarosebarras.com.

Jonetta Rose Barras' column appears on Tuesday and Friday. She can be reached at jonetta@jonettarosebarras.com.

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