Due to lax enforcement, 44 percent of the Otsego County Probation Department’s restitution accounts were delinquent for more than a year and had a total balance due of more than $137,000 in restitution moneys and administrative fees, according to an audit released by State Comptroller Thomas P. DiNapoli.  Much of the money the department failed to collect could have been used to defray department expenses, the audit found.  The audit, conducted between January 2006 and March 2008, also found that the department in turn failed to disburse approximately $10,000 of the restitution money it collected to crime victims.  

Additionally, the department’s weak internal controls over cash left the department vulnerable to theft, and its employee classification process could have mistakenly enrolled contractors into the state Employee Retirement System (ERS).

“Public officials have to watch every penny of every tax dollar,” said DiNapoli.  “Bad accounting and lax enforcement not only waste tax dollars; they undermine the public’s confidence in government’s ability to provide the services they pay for.”

DiNapoli’s auditors found that:

• approximately $9,780 of unidentified, undisbursed restitution money on deposit as of August 31, 2007 was not paid to crime victims because the department’s records were not sufficient to identify the intended recipients;
• more than  $47,000 in county revenue had not been collected on active and inactive probation accounts as of October 2007 that could have been used for department operations;
• because the department’s bank account was not earning interest, the department did not collect over $313 in interest revenues that could have been used to pay crime victims;
• internal controls weaknesses in the county’s worker classification process increase the risk that the county could improperly enroll non-employees (independent contractors) into the ERS; and
• there was a lack of segregation of duties, a lack of accountability over moneys collected at the satellite office, untimely deposits and remittance of fees to the county treasurer, and a lack of monthly reconciliations, increasing the likelihood that a theft or loss of moneys could take place and remain undetected.

• establish collection procedures, including – at a minimum – sending statements to individuals who owe the county restitution moneys, surcharges, and probation fees, and proactively enforce collection of overdue amounts;
• ensure that more than one person handle all phases of department transactions;
• deposit restitution moneys in interest-bearing accounts, and use the interest to compensate crime victims whose restitution orders have remained unpaid for the longest period of time;
• establish formal procedures for cash collection, communicate procedures to staff and ensure they are followed;
• accurately record and quickly deposit all restitution moneys collected;
• reconcile the restitution cash control register to the bank statement monthly and
• ensure that the department’s operations and books are regularly audited.

Otsego County officials generally agreed with the DiNapoli’s recommendations, and indicated they would take corrective action.

Click here for a copy of the audit