External auditors hired by Wake County say that overrides or neglect by management could have been at fault as $2.3 million went missing from the Register of Deeds office between June 1, 2008, and March 31, 2017.
The firm Elliott Davis Decosimo said that it is Wake County's responsibility to maintain internal controls over cash and other revenue taken in by the Register of Deeds office. The missing money has been the subject of a State Bureau of Investigation criminal probe announced in March by county manager Jim Hartmann and District Attorney Lorrin Freeman.
Generally speaking, the auditors say, collusion or management flaws can lead to problems including fraud.
"Because of the inherent limitations in any internal control system, including collusion, management override of the control system, or neglect to follow established policies could result in errors, irregularities, or fraud occurring without being detected," the Elliott Davis Decosimo auditors found.
The Raleigh office of Greensville, South Carolina-based Elliott Davis Decosimo sent the independent accountant's report released Friday to county attorney Scott Warren. It reflects the accountants' response to the findings of Wake County's internal audit department, which follow: "Based on the audit performed by IA, revenue as recorded in the Systems for services provided by ROD during the Period, exceeded deposits to the County’s bank accounts for those services by approximately $2,300,000."
Elliott Davis Decosimo states in its report that it's the county responsibility to to put in place "internal controls over the revenue recorded within the Systems and cash collected by the [Register of Deeds]."
As an elected official, former Wake County Register of Deeds Laura Riddick, by tradition rather than law, had more control over her office then heads of other departments
. (Riddick retired in March, citing poor health, within a few days of the announcement of the SBI investigation.) Settled law grants greater control to North Carolina sheriffs, but the situation regarding registers of deeds in North Carolina is less clear.
In a 266-page insurance claim issued earlier this week
, director of internal audit John Stephenson said his department checked practices at several other Wake County departments during the period when cash was disappearing from the Register of Deeds office.
"Beginning in December of 2014, Internal Audit performed a series of ten cash receipt reviews across the county, although none within the Register of Deeds office," Stephenson wrote.
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