Legislative Oversight Investigating Fraud at SCDOT

South Carolina Department of Transportation is currently seeking a massive increase in funding to be derived from an increase in tax on gasoline. This hearing starts with testimony from Paul Townes, the Chief Internal Auditor of SCDOT.

Rep. Ralph Norman questioned Chief Internal Auditor Paul Townes about the fact that SCDOT has used contractors who were convicted of fraud, and barred from receiving federal contracts. For a period of only 6 months, these contractors were also barred from receiving South Carolina contracts, but subsequently SCDOT contracted with a “new” company, which operated from a building that was leased by the “old” company. The “new” company used equipment that still bore the name of the “old” company. The “new” company had employees, who had been employees of the “old” company.

It was alleged that audits were “tabled” if they made DOT look bad.
The DOT Internal Auditor found fraud, which was reported to DOT management, but no action was taken. This same fraud was later prosecuted by South Carolina Law Enforcement Division. Chief Internal Auditor Paul Townes stated: “We used to do the fraud investigations at DOT, we’ve been restricted from doing those now.”

DOT Internal Auditor was told to stop an investigation on outsourcing.

The cover up of reports produced by The Internal Auditor has been so overt that Michael Wooten admitted to having plans to terminate employment of Chief Internal Auditor Paul Townes at the next Commission meeting. Commissioner Wooten stated: “Well, either Mr. Townes needs to understand that we are his boss, the Commission, or he needs to find another job.” Wooten is Chairman of the Internal Audit Subcommittee of the commission of SCDOT. Wooten stated that an audit was not “final” until it had been approved by the Commissioner. Wooten admitted that there were audits that were withheld from the legislature. This admission was made directly to the very legislature from whom these audits were withheld. Rep. Phyllis Henderson asked if that report was subject to a Freedom of Information Act and she was told that it was not, because it is only published after it was a “final” audit.

Paul Townes states: “Act 114 states that we’re to distribute all our audits to the Commission as well as four Legislators over committees. And I recently received a new job description that says the Commission wants to review them before the Legislature sees them. If you read Act 114, it tends to have all five groups getting them at the same time. But now we’ve got a new step in here that’s being proposed that the Commission would have the authority to see them, and stop them actually, before they were sent over to the Legislature.

Former DOT employees have attended DOT Commission meetings negotiating on behalf of contractors, as little as one month after they left SCDOT. Townes: “When you come to a Commission meeting, the former people who used to work for DOT are at that meeting. And a lot of them are not there after they’ve been separated a year, they’re there almost the next month.”

Internal Auditors of SCDOT were told directly that they are to do nothing except what management told them to do. SCDOT held meetings which the Internal Auditors were prohibited from attending. SCDOT admits to holding closed “executive session” meetings, where the discussion was about dealing with Internal Auditors. The Internal Auditor’s job description has been changed in an attempt to deal with what management calls “philosophical” differences.

Now the questions are these:

Are we getting all of the fraud for which we are paying?

If we raise the DOT budget will we get better roads or will we just get richer criminals?

Paul Townes does NOT “work for” the people that he is auditing.

He works for the people of SC, and so do those who are trying to censor his reports.

Anyone who is not steadfastly committed to that reality should be fired without delay.

Wooten said that they were going to fire Paul Townes at the “next” Commission meeting.

Wooten said that the commission was in “lock step” agreement on this.

Well that “next” Commission meeting was on 8-20-15, and they did NOT fire Paul Townes.

The question as to who it is that should be fired is being resolved in another building just a few blocks away from SCDOT.

Would the people of South Carolina be better off if Paul Townes had Wooten’s job, or maybe Christy Hall’s job?

Why do we never hear that corruption is rampant?

Is it because, when corruption is rampant, no one dares to call it corruption?

Is it because when corruption is rampant the watch dog is eliminated instead of the criminal?

Who benefits from eliminating the watch dog against corruption,

other than those who are involved in the corruption?

Gov. Nikki Haley could fix this with a phone call.

Gov. Nikki Haley’s phone number is

Phone: 803.734.2100 803 242-4558
Fax: 803.734.5167

Thomas Jefferson said:
“The price of freedom is eternal vigilance.”
We add this:
“The battle for liberty is never won, and is never lost.
The battle for liberty always continues.
It is never too late, and it is never soon enough, to defend freedom.
No matter how enslaved we are, we always have hope.
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NOTHING EVER LIMITS THE GOVERNMENT, EXCEPT THE PEOPLE.
Any generation that fails to defend freedom will lose it.
The next generation will have to shed blood to gain it back.
When the defense of liberty becomes a crime, tyranny is already in force. At that point failure to defend liberty makes slavery at certainty.” John Perna

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Date

August 18th, 2015

Author

John Perna