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| Doug Bynon George Doyle, Tax Rehab, Las Vegas Tax Company, American Program Management, Omega Water Tax Fraud and Co man, Pump and Dump Santa Ana, Cal |
| 14th of Nov, 2011 by User595356 |
| VIRGINIA BEACH - After the city accidentally wired $600,000 to a company two years ago - money that still has not been entirely recouped - new policies were enacted to prevent mistakes like that from happening again.They didn't work.Last month, the city mistakenly wired an extra $400,000 payment to a company that handles Virginia Beach's supplemental pension plan, said Patricia Phillips, the city's finance director.This time, thanks to the new rules, the mistake was caught in a few days and the money was quickly returned. "Any time there are errors made, it's a serious matter," Phillips said. "That's why we have procedures in place."City Treasurer John Atkinson, who handles all transactions authorized by the city finance office, is less understanding. "It makes us look stupid," he said.Councilman Harry Diezel said he had mixed feelings after he was told of the payment problem by a reporter."If the process has worked, in terms of extra safeguards, then that's a plus," Diezel said. "The question - and you've got your finger on it - is why did it happen in the first place?" Phillips said it was human error but declined to identify the employee involved or whether she was disciplined. "There's no such thing as an infallible person," Phillips said.On Dec. 15, the employee submitted two payments to Great-West Retirement Services, a Denver-based company that handles the city government's version of a 401(k), said Nancy Leavitt, a Virginia Beach financial analyst. One payment was submitted for $409,082, but the employee soon realized it was wrong and submitted another payment for the correct amount of $408,979, Leavitt said. Phillips said the employee looked at the wrong date when she submitted the first payment. The city sends Great-West different amounts each payday, depending on changes in what workers deduct. Great-West then invests the money.When Great-West accessed its account in mid-December, it accepted both payments and immediately invested them. Gregg Seller, a Great-West senior vice president, said Monday that his staff discovered the double payment during a routine audit on Dec. 17, but Virginia Beach called the company before it could call the city. The money was wired back two days later, Seller said."It is rare, but sometimes a plan sponsor will mistakenly send two transmissions," he said. "It is very rare." The recent problems with paying vendors may lead to a policy change: the elimination of "pull-down accounts."In those accounts, city finance officials tell the treasurer's office how much money to put into an account for payment. The treasurer deposits the money and a vendor then withdraws it, or pulls it down, said Dave Tuttle, an accountant in the city treasurer's office.Atkinson says mistakes might be easier to avoid if the city paid vendors directly."If we do not create an account like that, companies like Great-West cannot pull the money down at their will," Atkinson said. "It eliminates them from the picture."Phillips said she will work with the treasurer's office to discuss possible new policies. She added that the lessons learned from working with Doyle, George & Co. helped the city create policies that quickly caught the mistake with Great-West.Doyle, George & Co. is a California company that used to run part of Virginia Beach's health care plan. The company's contract wasn't renewed in 2005, but the company was still paid $600,000 from January to May 2005. The error was blamed on miscommunication between the payroll and treasurer's offices.Once the mistake was discovered, Phillips demanded the money back, to no avail. In August 2006, the city obtained a court order in California requiring Doyle, George & Co.'s principal, Douglas Bynon, to pay back $650,000.To date, the city has recovered about $125,000, but collection efforts are continuing. Reach Richard Quinn at . |
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