The New Mexico State Auditor’s office is reviewing a recently published UNM internal audit report that found embezzlements in the UNM Student Bar Association’s finances.
On Aug. 14, the UNM audit department issued a detailed report of its investigation into the financial embezzlement in the Student Bar Association’s account from 2011 to 2013. The report laid out a timeline of the mismanagement of funds and made recommendations to keep another incident from happening in the future.
Audit officials said the majority of the recommendations of the report have already been implemented.
“We have sent the report to the State Audit office, but we have not yet received any feedback from them,” UNM Internal Audit Director Manu Patel said.
The report revealed that the president, whose name was not released, used an off-campus account for transactions of SBA funds, despite clear instructions in the organization’s handbook that all funds were to be deposited in the official SBA account.
According to the audit report, the funds in the account fell from $23,979 at the end of the 2011 financial year to $8,626 at the end of 2013.
On Oct. 8, 2013, the UNM Internal Audit Department began conducting an audit of the SBA off-campus bank account after being alerted to the issue by the School of Law Manager of Student Services. Internal Audit found that the account was “used for transactions that did not have any supporting documentation to determine if these purchases and withdrawals were related to SBA events and activities, including personal purchases and unauthorized cash withdrawals totaling $15,462,” according to the audit report.
The report’s conclusion states that Internal Audit found “several control deficiencies and non-compliance with UNM policies and procedures,” including SBA officers and Law School faculty and staff not attending required training sessions in cash management during the 2013 academic year.
“It all happened because the administration at the School of Law did not properly supervise funding of the association,” Patel said.
Patel said the internal audit report recommended the establishment of a check and balance system that could prevent the occurrences of such incidents in the future. Earlier, the Student Bar Association officials had financial freedom and the president and treasurer were authorized to withdraw money from the account any time. However, the auditors have recommended that all financial matters go through the accounts section of the school.
“The Law school has accounts section and they can make sure what supplies need be ordered gets ordered and paid for properly through the banner account,” Patel said.
As per recommendations of the report, the president and treasurer of the association will sign an affidavit every year declaring they do not maintain any off-campus account.
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“All the supporting documents must not only be reviewed by their president, treasurer and board but also by the account section of the Law school now,” Patel added.
David Herring, dean of the School of Law, said the administration and students of the school were really disappointed about the issue. However, he added the school had put new system into place that would prevent such incidences in the future.
“I think it kind of helped in pointing out what kind of checks we need. It was a great learning experience,” Herring said. “All the leadership of student organizations has learned a lesson from this. We have put a system into place that will prevent recurring of such incidents.”
The Student Bar Association has also developed a annual budget, as recommended in the audit. “First of all we have a budget in place, and then a review of the monthly transactions takes place. These measures are to spot any kind of unusual transaction,” Herring said.
The UNM Police Department has also initiated a criminal investigation of the case.
Lt. Timothy Stump, UNMPD’s public information officer, said he was unable to comment on the issue because it is an ongoing investigation.
Patel said he hoped this report would also help police in their investigation.
“At least this report will give them an idea of what documents to look for. Police did not have some of the information,” Patel said.
Sayyed Shah is the assistant news editor at the Daily Lobo. He can be reached at assistant-news@dailylobo.com or on Twitter @mianfawadshah. Jonathan Baca contributed to this article.
