Audit questions 80% of West Haven’s COVID spending

A new forensic audit of more than $1 million in COVID-19 relief funds spent by the City of West Haven indicates that approximately 80% of spending should not have been authorized. That does not include the hundreds of thousands of dollars a former state lawmaker and others are accused of stealing from the city.

The problematic expenses — nearly $900,000 out of about $1.13 million reviewed by auditors — were largely either ineligible expenses or lacked sufficient substantiation and documentation, according to the private company CohnReznick’s audit report, who was hired by the Office of State Policy and Management.

The audit, released Friday, also found “numerous instances” where the City of West Haven lacked “sufficient controls and safeguards to ensure proper accounting and reporting of CRF (COVID Relief Fund) expenditures.” Additionally, the lack of internal controls, policies and procedures and “other weaknesses” went beyond COVID funds, affecting “the city’s overall financial operations and management,” the auditors wrote.

“The areas identified may expose other areas to risk of fraud, waste and abuse,” according to the report.

Auditors said they were made aware of certain transactions considered potentially fraudulent and under federal criminal investigation, and did not include them in this review.

West Haven Mayor Nancy Rossi, a Democrat, said in a text message to The Associated Press that she had just received the report and had yet to review it.

“The city will not comment until we have had sufficient time to thoroughly review the report,” she said, adding that the city has the ability to refute findings with which it is not. disagree and submit additional documents.

Some of the financial control issues raised in the audit had already been identified by the state’s Municipal Accountability Review Board, which required West Haven to take corrective action. The board plans to meet in the coming weeks to “determine next steps,” including a corrective action plan.

The OPM hired CohnReznick to conduct the audit after federal authorities charged former Democratic Rep. Michael DiMassa, a former West Haven City Council aide, and his former business associate John Bernardo with wire fraud in October. The couple were accused of stealing $600,000 in COVID funds using fraudulent invoices submitted to the city through a company they started in January 2021 called Compass Investment Group LLC. Both pleaded not guilty.

In February, DiMassa’s wife, Lauren Knox, and John Trascacco, a business owner, were arrested in connection with the case and pleaded not guilty to one count of wire fraud and one count of conspiracy to commit wire fraud stemming from two separate alleged schemes involving Di Massa.

The two leading Republicans in the Connecticut State Senate called the audit a “stunning indictment” and said “if this could happen in one city, how do we know it’s not happening in others?” The senses. Kevin Kelly and Paul Formica said the report “reinforces the need for reform”.

Bob Stefanowski, the likely Republican gubernatorial nominee, criticized Democratic Gov. Ned Lamont and his administration for “not having procedures in place that would protect these funds from abuse.” A message was left seeking comment from Lamont’s spokesperson.

Stefanowski also called on Rossi on Friday to step down.

“She knew they were being watched by MARB, and she failed to put in place the necessary protections to ensure that local resources were protected and spent with the needs of residents in mind,” Stefanowski said in a statement. written statement.

Asked about the GOP candidate’s call for his resignation, Rossi said in a text: “I will not resign.”

Comments are closed.