EagleTribune.com, North Andover, MA

June 23, 2013

Editorial: Culture of dependency leads to fraud, theft


The Eagle-Tribune

---- — For a poor, cash-strapped city, Lawrence is remarkably careless with its cash.

The latest evidence of that carelessness is a report by Robert Nunes, the man sent in by the state in 2010 to oversee the city’s finances as the condition of a bailout to avert fiscal catastrophe.

The opening paragraph of Keith Eddings’ story last week on that report sums it up nicely:

“The city’s parking lots and garages are monitored by attendants whose cash-only collections are not verified, overseen by administrators who let the cash sit in drawers for weeks and secured only by obsolete surveillance cameras installed decades ago, according to a review released yesterday.”

As a result, the city is hemorrhaging money that people are paying to park their cars in city-owned garages and lots.

Where is the money going?

Investigators say thousands of dollars were stolen, and they have charged one parking attendant.

It was not a complicated scheme; it was something that would have come to light long ago had anyone been paying attention.

After the parking attendant was charged, it took Nunes less than two weeks to determine the parking operation is a shambles.

“The entire parking operation lacks any formalized standard operating procedures, instructions or best practices,” Nunes wrote. “There are no official job titles for managers and no detailed list of responsibilities for any of the 21 employees.”

The system is so dysfunctional and oversight so lax that parking receipts at the Museum Square garage dropped from a high of $31,000 in early 2011 to a low of just over $7,000 in May. But no one seems to have noticed or raised a red flag until the FBI and state police began investigating unrelated allegations involving the administration of Mayor William Lantigua.

This isn’t the first time Nunes has blown the whistle on bad management and lax or nonexistent oversight that have cost the city a significant amount of money.

In late 2011, Nunes confirmed earlier Eagle-Tribune reports that the city came out on the short end of a car swap between the Police Department and a Lantigua crony. The deal is under scrutiny by a grand jury.

Last fall, Nunes reported that a building inspector failed to inform assessors of $33 million worth of new construction, costing the city $300,000 in uncollected property taxes.

The lack of oversight is nothing new and predates the Lantigua administration by many years.

Just yesterday, we reported on theft and fraud charges brought against the IT director who served under Mayor Michael Sullivan, Lantigua’s predecessor. Essentially, authorities say, he contracted with friends to do the job the city was already paying him to do -- in effect charging twice for the work.

No one noticed, apparently, until Lantigua was elected and began turning over some rocks.

So the problem of lax oversight leading to lost money is longstanding and endemic to Lawrence.

Why?

What is it about Lawrence that causes it to be so careless with cash?

The common denominator in all of these scandals is that Lawrence is dependent on outside help to stay afloat.

It is playing with other people’s money -- like the federal grants that the former IT director allegedly milked for personal gain.

Who isn’t more reckless when playing with other people’s money?

As long as that culture of dependency continues, so will the scams.

Nunes’ report on the parking operation calls for “a comprehensive, independent, outside forensic audit” of the system.

We would extend that to the city’s entire financial operation, given the long history of abuse of other people’s money.