OIG Releases 3rd Quarter 2016 Report
October 18, 2016
Highlights of OIG activity from July 1 through September 30, 2016, are summarized below:
- An OIG advisory on Officer Involved Weapons Discharge Reporting suggested that the City articulate a clear vision of purpose for use-of-force reporting and that it commit to robust reporting—OIG determined that, prior to 2015, use-of-force reporting was inaccurate and incomplete. In response, the Mayor’s Office committed CPD to issuing public reports on uses of force beginning in September 2016. Following the filing of the third quarter report, the Department provided OIG with a Force Analysis Report for August 2016, which is available on OIG’s website. The Department committed to posting future quarterly reports on its data portal.
- The sentencing of former Chicago Department of Transportation Managing Deputy Commissioner John Bills to a 10-year-term of imprisonment an order of restitution for $2,032,959.50, and a judgment of forfeiture of $680,107 for his role in orchestrating one of the largest and longest kickback fraud schemes in the City’s history. Sentencing of cooperating co-defendant and former Redflex Traffic Systems Inc. CEO Karen Finley is scheduled for November 10, 2016.
- The payment of a total of $225,000 in restitution by two City contractors after OIG established that they were violating procurement rules. In one case an engineering services company circumvented the City’s competitive procurement process in its provision of two consultants under a master consulting agreement. The engineering services firm agreed to pay the City $175,000. In another case a contractor defrauded the Minority and Women-owned Business Enterprise (MWBE) program in order to overstate participation amounts. The contractor agreed to pay the City $50,000. Both firms committed to additional ethics-based planning, training, and monitoring.
- An OIG notification identified concerns that the Department of Finance (DOF) and City departments are not meeting the requirements of the City’s mileage reimbursement policy. OIG determined that a Chicago Department of Transportation (CDOT) division was not complying with its audit responsibilities under the policy, nor was DOF, which issued the policy in 2011. Despite its role in administering the policy, DOF did not know how or whether departments were auditing mileage reimbursement. DOF and CDOT stated that, after being contacted by OIG, DOF engaged an external accounting firm to audit mileage reimbursement practices in each department. The response further stated that DOF will issue a revised policy in the first quarter of 2017, provide training for departments on the new policy, and conduct follow-up compliance audits. The response confirmed that DOF has the resources to perform its role in the mileage reimbursement process. The Local Mileage Reimbursement & Other Local Transportation Policy was put in place in 2011, after OIG found systemic fraud in mileage reimbursement claims in the Chicago Fire Department (CFD)—including approximately $100,000 taxpayer dollars stolen in 2009 alone.
- An OIG investigation established that a Sanitation Laborer for the Department of Streets and Sanitation (DSS) engaged in a counterfeiting scheme involving over $10,000 of fraudulent City of Chicago payroll checks. OIG’s investigation established that over a five-month period, the laborer provided counterfeit City checks to three accomplices. After cashing the checks, the accomplices split the proceeds with the Laborer. DSS terminated the Laborer and two of the Laborer’s accomplices were convicted in the circuit Court of Cook County.
- An OIG investigation established that a Department of Buildings (DOB) employee improperly worked at least four side construction jobs, collecting a total compensation of over $27,000. The employee admitted to having worked on such unapproved side jobs for over twenty years, throughout the employee’s tenure with the City. Two of the four side jobs OIG identified required DOB permits, which is expressly prohibited by DOB’s 2012 Ethical Guidelines. DOB agreed with OIG’s findings and suspended the employee for 15 days, which the employee has appealed.
- After sustained OIG investigations revealed that two community organizations used special service area (SSA) funds as collateral for lines of credit, OIG issued a notification to the Department of Planning and Development (DPD) suggesting that DPD work to ensure that it was identifying and remedying all such inappropriate activity. In response, DPD stated that it now requires agencies to disclose any loans or lines of credit that they use to fund SSA programs and services. In addition, DPD secured additional funding for its independent auditor to annually “review all loan and line of credit agreements.” The most recent sustained investigation related to OIG’s notification was reported in Quarter 2 of 2016.
- In two separate cases, an arbitrator and the Human Resource Board upheld terminations related to OIG cases. In an appeal involving a residency violation the arbitrator noted that, based on the extensive evidence amassed by OIG, the City had “overwhelmingly met its burden of proving that the Grievant does not reside in the City of Chicago.” In another case, the Human Resources Board upheld the termination of a City employee who stole between $440 and $500 from an O’Hare International Airport vendor while on duty.