Financial Accounting Blog

Saturday, March 05, 2005

Anonymous Letters to Auditors. Newsday reports that an anonymous letter to state auditors led to the uncovering of a massive fraud in a Long Island school district.
The Roslyn school scandal unfolded last year after an anonymous letter tipped off authorities that top officials had engaged in systemic misspending for a decade. So far, three former district officials -- Superintendent Frank Tassone, Assistant Superintendent for Business Pamela Gluckin and accounts payable clerk Debra Rigano -- have been arrested and pleaded not guilty to charges of grand larceny. Now auditors say as many as 29 people may have benefitted from the scheme.

Auditors found that much of the fraud revolved around the abuse of district credit cards originally issued to Tassone, Gluckin and Rigano. Those three in turn handed out the cards to family and friends until 74 cards were circulating among 13 people. Between 1997 and last year, they charged $5.9 million for personal use.

New details describe how those involved sought to conceal the fraud amid the growing scandal. On a February evening last year, someone logged on to a computer in the business office, made calls to three district officials, then changed vendors' names to hide the personal spending, the report found.