Friday, March 14, 2008

NRCC Tries to Defend Incompetent Governance Oversight

Just over a week ago the story broke regarding the National Republican Congressional Committee's fraudulent audits and possible embezzlement of political donations by Treasurer Christopher J. Ward. Despite suggestions that numbers wouldn't be known until after the November election (Eliot Spitzer banged a whore , possibly aided by taxpayer money?), the committee came clean and is now concerned about a missing $1.74 million. A number could now be available in coming weeks (hopefully not more than "Kristen's" movie deal compensation).

This morning's Associated Press story had Republican leadership on the defensive as to how a "lone perpetrator" could have pulled off a five year scam, especially in the wake of Enron, WorldCom, and the passage of legislation intended to prevent future financial debacles, Sarbanes-Oxley. The AP story stated:

Kelner said that in hindsight, NRCC officials wish they had been suspicious about the fact that outside auditors never visited the Capitol Hill headquarters or received payment for their supposed work. He also agreed "it's a best practice not to have any significant money-handling authority vested entirely in one person."

Rep. Tom Cole of Oklahoma, the NRCC chairman, said in a statement that he wants to assure supporters "that every effort is being made to prevent such a fraudulent act from happening again."

Sorry Tom, anyone who served on a nonprofit board doesn't buy your bull hockey. Since the passage of Sarbanes-Oxley, outside auditors interview Board members as part of the audit process. That no RNCC Executive Committee members were interviewed over a five year period should have been deeply concerning, Mr. Chairman.

Accounting firm partners love to present the audited financial statements and management letter. They would've drooled over the opportunity to present to important Congressional Republicans. That five years went by without such a presentation is more than a flapping red flag.

Apparently the skills our Republican House leaders use to run the country don't cross over well in the world of nonprofit organization governance. Sad days indeed...