Tax Watch

An audit released today on the State University of New York Research Foundation uncovered “numerous cases of abuse of taxpayer dollars,” including improper use of credit cards, a conflict of interest on contracts and overpayment of a senior counsel, state Comptroller Thomas DiNapoli announced.

The audit found that senior SUNY Research Foundation official at Buffalo State College —Edgar H. Turkle III—used his foundating credit card to enrich himself. Of the 424 of Turkle’s credit-card transactions investigators and auditors reviewed from November 2007 through November 2011, they found 348 of them totaling $130,887 were not business related. Examples include $22,225 for Buffalo Sabres hockey tickets and other expenses, such as a birthday party for his wife, an Apple computer, iPad and iPhones, chocolates and groceries. He incurred $125,342 in expenses for foreign travel, primarily in Asia.

Turkle has been terminated by the Research Foundation, according to DiNapoli, and the audit’s findings have been referred to law enforcement.

DiNapoli criticized the Research Foundation’s $913,500 payment for a single-source contract with Skadden, Arps, Slate, Meagher & Flom LLP and Affiliates—where the state’s former chief judge works—to conduct a probe and legal analysis of the troubled Binghamton University men’s baseketball program for the SUNY Board of Trustees. The contract was set up and the work was performed before the justification for sole source was documented, DiNapoli’s office found.

“For too long, SUNY Research Foundation employees took advantage of lax oversight to cheat taxpayers, skirt state laws and violate the foundation’s own policies,” DiNapoli said. “The Research Foundation needs to vastly improve its internal controls, budgetary oversight, and ensure compliance with all relevant laws and policies. The foundation needs to recover all misspent funds immediately and fundamentally change how it operates.”

DiNapoli announced that he would conduct another audit of how the Research Foundation charges SUNY campuses for overhead costs, how that impacts campuses financially and the administration of overhead dollars that are administered by the foundation.

The Times Union of Albany reported last week on the draft audit of the SUNY Research Foundation.

Other problems with the Research Foundation that were cited in the audit include:
—Documentation justifying a sole-source contract to O’Connell & Aronowitz for legal services totaling $908,437 was not dated or signed. There was no documentation to justify awarding six sole-source contracts with law firms totaling $348,916. Ten of 13 central office contracts that were awarded on a sole- or single-source basis violated foundation policy. The 10 contracts totaled nearly $3 million, the report said.
—  SUNY Central Office paid the former general counsel and secretary $345,034, plus a severance package totaling $308,546, for less than a year of employment. 
—Auditors questioned the time and attendance of now-former Research Foundation employee Susan Bruno, the daughter of former Senate Majority Leader Joseph Bruno, a Rensselaer County Republican. DiNapoli’s office has asked Attorney General Eric Schneiderman to look into the matter separately. 
—Chancellor Nancy Zimpher’s account was charged $27,968 for questionable items, including $13,172 for beverages (mostly alcohol) and $9,822 for the chancellor’s membership in a private club.
Di Napoli Suny Audit