As millions of Americans conduct their finishing touches on filing their taxes, the Palmetto State has a different problem: finding out who created a secret bank account and how $1.8 billion was deposited into it. Maybe it’s not a hidden account, but how the money got there is a mystery. Forensic accountants are now trying to unravel this mess, though accounting errors in South Carolina state affairs are hardly anomalies. As with most government budgets, it’s pretty common.
It’s like the film Office Space, where one of the main characters misplaces the decimal point in the money-siphoning scheme directed at their company. It’s sort of like that—the state’s higher education accounts had money double posted by the comptroller general. Regarding the $1.8 billion account, it has a paper trail spanning a decade, an investigative task that’s certainly not an enviable one (via CBS News):
South Carolina has collected about $1.8 billion in a bank account over the past decade — and doesn't know where the money came from or where it was supposed to go.
"It's like going into your bank and the bank president tells you we have a lot of money in our vault but we just don't know who it belongs to," said Republican Sen. Larry Grooms, who is leading a Senate panel investigating the problem.
The bank account, which is now being examined by state and private accountants, is the latest trouble with the state's books and comes after South Carolina's top accountant resigned last year. In that case, elected Republican comptroller general Richard Eckstrom stepped down after his agency started double posting money in higher education accounts, leading to a $3.5 billion error that was all on paper.
The paper error started during a decade-long transition to a new accounting system, which began in 2007, according to the South Carolina Daily Gazette.
But the $1.8 billion involves actual cash placed in a bank account. Now, lawmakers are asking why the money was parked there in first place and why officials never fixed the problem,
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Whatever caused the bank account errors has not been rectified, and if there are records showing where the $1.8 billion came from, they have not been shared with state leaders.
"It does not inspire confidence. But the good news is no money was lost," Republican Gov. Henry McMaster said.
Elected Republican Treasurer Curtis Loftis, whose job is to write checks for the state, has said he invested the money in the mystery account and made nearly $200 million in interest for the state, which led to questions about why he didn't let the General Assembly know money they either set aside for state agencies or that might have been in a trust fund was just sitting around.
Loftis said that wasn't the job of his office.
Who controls the purse in South Carolina?
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