John Locke Update / Research Brief

Wake County Shows Need for Better Oversight of County Offices

posted on in City & County Government, Local Government
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U.S. Dollars as a matter of investment.

Over the summer, there’s been a lot of media attention focused on the Wake County Register of Deeds office.  I blogged about it back in early August, and if you’re not familiar with the story, that blog post will give you an overview.  But there’s been quite a lot more to come out since then.

The issue is missing money.  By August, they’d found $895,000 missing over three years.  Now, they’ve managed to go back to 2008 and found at least $2.3 million missing.  The State Bureau of Investigation is investigating.  Wake County has filed an insurance claim.  As far as I know, one employee has been fired after admitting taking $50,000.  But the investigations are ongoing, and many people seem to be looking in the direction of former Register of Deeds Laura Riddick.  She’d been in the position for 20 years before retiring this spring due to health issues.  If she does, indeed, prove to be the primary culprit, the losses could be much greater.

The details of that case, though, are less important than the lack of oversight that was revealed.  Rightly, people have been asking lots of questions, but they all boil down to this: How could so much money go missing for so long with no one noticing?

The various answers are telling.  First, people seemed to have confidence in Laura Riddick personally.  Take this, for example, from a recent article in the News & Observer:

…former Register of Deeds Laura Riddick appeared to be a “meticulous” office leader, said Johnna Rogers, deputy county manager.  “Just from our regular interactions with her and how she was so customer-focused, very much into improving the technology, there just wasn’t any indication she wasn’t at the top of her profession,” Rogers said.

And then there’s the fact that Riddick was elected.  I keep reading that over and over, and I can only conclude that either a) people trust elected officials more than bureaucrats, or b) there’s some sense that being elected limits the oversight county commissioners can legitimately exercise.  Both of those positions seem problematic to me.

The Register of Deeds office hadn’t been audited for thirteen years before the missing money came to light over the summer.  When we’re talking about an office that handles millions of dollars of taxpayers’ money, thirteen years is too long.  Wake County Commissioners have now decided that the Register of Deeds office will be audited annually for a while, but the truth is that, in the wake of this scandal, I expect everything will be squeaky clean in that office for the foreseeable future.  Annual audits are a good idea, but what about every other office handling millions of dollars?  What this whole debacle reveals is not a problem particular to the Register of Deeds but a problem that exists wherever there is lack of oversight and accountability.  More frequent audits should be implemented for all offices and departments.

And then there’s a technological issue.  The Wake Register of Deeds still requires some fees to be paid in cash.  They don’t accept credit or debit cards.  I can’t think of very many other places where that’s the case.  Fast food, parking decks, and taxis all take cards.  But this government office doesn’t.  Obviously, it’s easier to pocket cash at the end of the day than to steal credit card numbers.  Cash lying around invites temptation and theft.  And so, the office will start accepting payment by credit and debit cards later this year.  That’s a good thing, but it shouldn’t be limited to this office.  Are there other places within local government where cash is required?  If so, we should move to electronic payments for all of them.

My point is this.  The Wake Register of Deeds fiasco offers an extreme example, but one wonders whether other local government offices in the state that have had cash disappear.  Unfortunately, humans are susceptible to that sort of temptation.  There are probably other sorts of irregularities that could be found if we knew where to look.  Perhaps this incident can serve as a wake-up call to local governments across North Carolina.  Perhaps there are lessons that can be learned.  If so, Wake County’s loss can be North Carolina’s gain.  Better procedures for handling money, regular audits, and electronic payments can all help local governments ensure that taxpayers’ money is going where it’s supposed to.  And that is an important and central role of local government.

Julie Tisdale is City and County Policy Analyst at the John Locke Foundation. She studies the effectiveness of local spending and tax policy. Before coming to the Locke Foundation, she worked at the Centre for Civil Society in New Delhi,… ...

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