An audit of the New Bern Housing Authority identified material weaknesses and significant deficiencies, which included an act of fraudulent theft, among other issues.
Ben Karlin, senior manager with Rubino, presented an audit to the New Bern Housing Authority’s Board of Commissioners on Oct. 21, 2024 during a Zoom meeting. He said they found fraudulent payroll activity and significant deficiencies in capital funding.
Karlin said, an employee authorized excess salary disbursements, which was an act of fraudulent theft in the amount of $18,931. He said this occurred in 2023 and again, in 2024.
The audit report noted, “The authority did not have the appropriate controls over the payroll process to prevent and/or detect fraud in a timely manner.”
Rubino recommended the authority should review and enhance its policies, procedures and internal controls to ensure that fraud is prevented and/or detected in a timely manner.
Karlin said they found a significant deficiency with the obligation requirement for Capital Fund Program drawdowns.
“Capital Fund Program costs are required to be obligated within 24 months of the execution of the grant with documentation showing the funds were truly obligated,” the report noted.
“The authority did not have adequate controls over the obligation process, resulting in capital funds obligated in HUD’s eLOCCs without obligating funds,” the report said.
The report identified missing procurement documentation, which was another significant deficiency.
“The authority did not procure goods and services property under the required regulations,” the report said.
Reginal Barner, the NBHA interim executive director said, “There’s nothing that’s been presented that I’m concerned about that we have not been able to address and move to correct.”
The Board of Commissioners approved the FY 2023 financial audit. Chairman Ronald Scott, Commissioners Sabrina Bengel, Jennell Reddick, James Copeland, Sulin Blackmon attended from a conference room at the NBHA and Commissioner Dana Outlaw attended from an unknown location. Commissioner Denise Powell was absent.
In other news, the New Bern Board of Aldermen will meet tonight at 6 p.m. in the City Hall Courtroom at 300 Pollock Street. The meeting agenda and packet are available here.
Watch the Housing Authority’s meeting here:
By Wendy Card, Editor. Send an email with questions or comments.