Audit reveals questionable gifts at county government association
OKLAHOMA CITY — Gifts that ranged from honey-baked hams to Oklahoma City Thunder basketball tickets were given to employees of an Oklahoma county commissioners association by a law firm hired to defend counties against property and liability insurance claims, according to a state audit released Monday.
The gifts came from the law firm of Collins, Zorn & Wagner, which was paid more than $13.8 million from 2010 through 2014 to represent counties through the Association of County Commissioners of Oklahoma Self-Insurance Group, auditors said.
Oklahoma County District Attorney David Prater, who requested the audit, said he just recently received a copy and is reviewing it to determine whether any criminal activity has occurred.
One of the key issues in evaluating potential criminal charges is whether ACCO employees can accept such gifts — something they would be prohibited from doing if they were government employees.
ACCO is a nonprofit organization that receives about 88 percent of its funding from public fund sources.
Fired ACCO Executive Director Gayle Ward appeared to be among the gift recipients, auditors said, citing email correspondence between Ward and the spouse of Chris Collins, president of the Collins, Zorn & Wagner law firm.
Ward was given a $2,388.74 weekend trip to San Jose, Calif., that included a $1,027.20 round-trip airline ticket, three-night hotel stay that cost $1,152.59, and a ticket to an Oprah Winfrey event that cost $208.95, auditors said. Ward told officials she later tried to pay for the trip, but her check was never cashed.
Collins’ law firm, a tenant in the ACCO building, also paid Ward’s brother, Dennis Winsett, amounts ranging from $2,000 to $3,000 per month to provide janitorial service for the building. Although building maintenance was the responsibility of ACCO and its insurance organizations, ACCO would pay Collins’ law firm, which in turn would pay Winsett, auditors found.
Collins or his law firm also paid about $4,000 for transportation and a reception associated with the funeral of Ward’s husband, auditor said.
Collins did not return a message left on a voicemail seeking comment.
An investigation into activities at ACCO was launched last year after former General Counsel Clay Bruner came forward with allegations of conflicts of interest and other improprieties. The board of directors ended up firing both Ward and Bruner last March.
“ACCO has been under new management for the past 11 months and has already corrected many of the issues discussed in the audit report,” Gary Starns, chairman of the board of ACCO, said Monday in a prepared statement. “We will review the report carefully and make additional reforms as necessary to correct deficiencies.”
In addition to the gifts to Ward, Collins’ law firm gave honey-baked hams to all ACCO employees at Christmas and on other occasions gave ACCO employees gift cards of $100 or less per occurrence, cash of $100 or less per occurrence, Oklahoma City Thunder basketball tickets and dress and golf shirts.
Collins’ law firm also provided free legal services to several ACCO employees and their families including adoption assistance, traffic citation assistance, help in expunging records and mortgage assistance, auditors said.
State Auditor Gary Jones said he believes the gifts were inappropriate since public funds provide about 88 percent of ACCO’s revenues and government employees would be prohibited from accepting such gifts under Oklahoma ethics rules.
ACCO employees have at times claimed to be employees of a nonprofit organization and at other times claimed to be government employees, depending on the situation, auditors said.
ACCO officials claimed to be part of a “government entity” in 2006 when they entered into an interlocal government agreement to enable ACCO employees to receive health insurance through the Oklahoma Public Employees Health and Welfare Plan, auditors said.
However, ACCO officials have contended they are not required to comply with the Oklahoma Open Meeting Act and Open Records Act because their organization in a nonprofit group and not a government agency.
Auditors said they believe ACCO officials must comply with the Open Meeting and Open Records Acts because they receive so much of their revenue from public funds.
Oklahoma Attorney General Scott Pruitt was asked to issue an opinion on the same issue nearly a year ago, but has not yet responded. Mike Hunter, Pruitt’s first assistant, said the attorney general has held off on issuing opinion to give the state auditor and Oklahoma State Bureau of Investigation an opportunity to complete their probes.
Auditors also found a lack of spending controls on ACCO credit card purchases.
“ACCO has no policies, procedures or guidelines governing their credit card purchases,” auditors said. “Between January 2013 and March 2015, ACCO credit cards were used to purchase over $273,000 in travel, gifts, food, conference and party related expenses.”
Auditors questioned the reasonableness of a number of gifts purchased for board members or to be given away as door prizes or bingo prizes at ACCO events.
ACCO credit cards were used to purchase $8,654.32 worth of knives to be given away as prizes and gifts. That included $2,495.08 worth of knives given to board members as Christmas gifts.
Among other gifts purchased to be given away as prizes were iPads, a 47-inch TV, a Kindle Fire tablet, computer monitor, Stihl chain saw, grill, Yeti Tundra cooler and Visa gift cards.