Friday, March 7, 2008

National Republican Congressional Committee What Auditors?

The Finance Director of the Congressional fundraising arm of the Republican Party was asleep at the switch for over four years. Representative Eric Cantor, R-VA served as Finance Chairman for the Committee. Why didn't he get suspicious over not meeting members of the audit firm? Under Sarbanes-Oxley, auditors interview board members regarding possible diversion of funds or misrepresentation of material facts.

Anyone in Cantor's position on a board from 2003 on should have met face to face with an auditor. Partners in accounting firms love to come present the management letter and audited financial statements to boards. They love it even more when board members are powerful and politically connected. That Cantor never met an auditor or accounting firm partner should have been a red flag.

My representative, Mike Conaway, R-TX, caught wind of the malfeasance via this very fact. The New York Times reported:

"I just kept insisting that we meet with the auditors," Mr. Conaway said in an interview. "It finally came into my head, and as the circumstances unfolded, that no audit had been done."

The question is how long Mike served on the audit committee? When was he appointed? I hope he found it the first audit cycle. However, Mike's catch doesn't excuse the remaining leadership of the NRCC from ensuring a basic audit was done annually, especially when $178 million in donations flowed through the organization during the 2006 election cycle. The end result is hundreds of thousands of dollars are missing and presumed stolen. This from the party of morals...