November 13, 2007
Tax Scandal Likely Worse Than Initially Reported
Let's check in with the widening Office of Tax and Revenue embezzlement scandal, shall we? Over the weekend, the Washington Post reported that two more tax office employees had been placed on leave from their jobs in connection with the alleged $20 million-plus fraud, though CFO Natwar Gandhi refused to identify them except to say they work in the real property assessment division of the office. Four senior managers have tendered their resignation since the news broke. Two tax office employees, Harriette Walters and Diane Gustus, have been arrested along with a number of non-government co-conspirators.
Amid warnings from authorities that the grand total of this mega-fraud could go "substantially higher," The Examiner has now uncovered evidence that checks to a phony company implicated in the fraud scheme, called "Bellarmine," date back as early as 1999, when Gandhi was still the head of the Office of Tax and Revenue. Gandhi became CFO in 2000. These revelations come after Gandhi gave a public statement that he personally reviewed and signed every check that left the tax office while he was in charge there -- which was his justification for asking for the resignations of Sherryl Hobbs Newman, her deputy director, Matthew Braman, the director of real property tax administration, Martin A. Skolnik, and the chief assessor, Thomas Branham.
On Saturday, several D.C. Council members were sticking up for Gandhi, saying his reputation went beyond this scandal and he should not be asked to resign. Mayor Fenty has also been notably quiet on the matter. Think these latest revelations might actually jeopardize Gandhi's job?
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From what I've read, it doesn't seem as if anyone has the authority to fire Ghandi. I guess Fenty could ask him to resign, but I don't think he could force him to.
I'm still not sure whether he ought to resign. I realize he'd sort of be following a double standard ("sort of" because his apparent negligence in approving these checks ended seven years ago while those people that got fired got fired for screwing up in the present) but he's been a solid CFO. I'm afraid any replacement would be a step back.
Although, maybe if Fenty were given the chance, he could appoint another ball-buster like Rhee, which could be a good thing.
This is one of the few offices that Fenty doesn't have authority over, as noted in the last Washington Post link. Interesting that he is keeping mum in an area where he has little to no power, which must be driving the Bloombergean, bull pen using, everything man nuts.
I dunno on Gandhi. It looks as though these women started slow and small and got bolder over the years. I think also when you're struggling to clean up a whole lot of financial messes, some will get overlooked for a while. wonder what other financial scandals will eventually emerge.
The shocking statistic to me was buried in the recap story over the weekend. 20 percent or -- one out of every five dollars -- in property tax refunds were given to these women this past year.
I take back what I said about Gandhi after skimming the other Examiner article about the coziness of his relationship with the city's private auditors. hmmm.
Didn't Tony "The Tiger" Williams used to be CFO? I'm pretty sure the position was set up deliberately to be autonomous from the Mayor's office (Barry at the time). 'Course, that was back in the day when Congress couldn't strip the Mayor-for-Life's powers fast enough.