MUSD to Undergo Forensic Audit

By Nancy Martinez, EGP Staff Writer

After receiving several phone calls from Montebello Unified employees alleging fraud and misuse of school district funds, Board Member Ben Cardenas has called for a full forensic audit of MUSD’s finances.

“There was enough to merit a closer look,” he told EGP, explaining he hopes an audit will clear any doubts about the school district’s financial practices.

“The nature of the allegations was important,” he said,

Cardenas’ initial call for the audit came last week when he still held the title of MUSD board president. While the school board will not officially act on his request until its meeting tonight, according to newly appointed Board President Lani Cupchoy, district staff is already looking into firms with the expertise to conduct the work.

The forensic audit will exam MUSD’s accounting procedures, policies, priorities, spending protocols and lines of authority and seek to uncover any theft of cash or inventory, fraudulent payments, corruption, conflicts of interest, bribery, extortion and misstatements.

Cupchoy told EGP conducting the audit would help reassure the public that the school district is being run properly, which is timely given that voters just approved a $300 million school bond in June.

“We are opening our doors,” she told EPG. “We owe it to the public.”

 New MUSD Board President Lani Cupchoy announces the district will undergo a forensic audit, following her appointment during the Dec. 8 meeting.  (EGP photo by Nancy Martinez)

New MUSD Board President Lani Cupchoy announces the district will undergo a forensic audit, following her appointment during the Dec. 8 meeting. (EGP photo by Nancy Martinez)

Cardenas also wants the district to set up a tip line where employees and others can anonymously report fraud without fear of retaliation.

“It seemed many [employees] were afraid of speaking out,” Cardenas told EGP.

News of the proposed audit comes on the heels of the controversial firing of Superintendent Susana Contreras-Smith and Chief Financial and Operations Officer Cleve Pell, a longtime MUSD administrator who has served in various upper-management positions, including co-superintendent.

The firing prompted someone to create, a website critical of the district that claims the two former administrators were actually fired because they tried to take a stand against corruption. The site also alleges MUSD’s attorney was replaced to hide the cover-up.

Earlier this year, the California School Employees Association (CSEA) Montebello Chapter 505 passed a “vote of no confidence” targeting the MUSD Chief Business Officer Ruben Rojas, who earlier this year was briefly placed on paid administrative leave for what was only described as a personnel issue.

CEA’s no confidence vote accuses Rojas of hiring personal acquaintances, lowering morale district-wide and not adhering to project labor agreements among other issues.

Residents and employees have also expressed disapproval of some contract bids approved by Rojas.

On Wednesday, however, MUSD released a statement announced that it has received a AAA rating from the Fitch Ratings Agency for the $100 million voter-approved school bond to be issued by the district. It’s the “highest possible credit rating any bond issue can receive, including those of the U.S. Federal Government and would save local taxpayers millions of dollar,” according to the announcement.

Rojas said the credit rating “is a testament to the strong fiscal management’ of the district. “We will continue to make smart fiscal decisions that will allow our schools to thrive,” Rojas said.

Cardenas would not divulge details of the allegations, claiming he does not want to prejudice the audit process or enter the realm of speculation. Regardless of the outcome, he said he believes the audit will help the board and public achieve a better understanding of the district’s budget, providing a deeper understanding of what needs to be done to make sure the district is operating efficiently.

“This is the best investment we can make,” he assured.

After hearing rumors of wrongdoing, Linda Nicklas, co-founder of the Montebello watchdog group MATCH90640, told EGP she’s looks forward to the audit.

“We need a independent audit, with absolutely no ties to anyone on the board,” she said.

Cupchoy told EGP she does not believe the audit paints the district in a negative light.

“It’s not something negative or wrong,” she said. “I see it as a safety net.”

Cupchoy told EGP that the district’s number one priority is making sure all money is used to serve its 29,000 students. A fiscal audit will provide guidance and ensure there is equity across the district, she said.

“The audit is not about the finances,” she told EGP. “It’s about investing back in our district.”


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December 15, 2016  Copyright © 2012 Eastern Group Publications, Inc.


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