Auditors recommend 17 changes at UofL - wave3.com-Louisville News, Weather & Sports

Auditors recommend 17 changes at UofL

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LOUISVILLE, KY (WAVE) - A string of high-level University of Louisville employees have been accused of defrauding the school over the past several years. Now, UofL leaders believe they have a fix. The results of an audit were released July 2 and the message was clear: more centralized financial monitoring could possibly catch these problems before they cost the school hundreds of thousands - or in one case - millions of dollars.

In September 2013, allegations came to light that Perry "Chad" Vaughn, an employee in the School's Department of Family and Geriatric Medicine wrote checks to himself for more than $2 million and used it to buy fancy cars and exotic trips.

At the time, Dr. James Ramsey said, "Sometimes people just do things they shouldn't do."

The allegations against Vaughn came after Brandon Hamilton, an assistant dean at UofL's law school, was accused of handing out extra money in scholarships and Alisha Ward, a business school employee, was convicted of stealing almost a $500,000 from the equine program.

"We'll let the investigation play out and see what other changes need to be made," Dr. Ramsey said at the time.

The same month, UofL asked an auditor to review the school's internal and vendor controls, internal audit function and to assess previous audit reports. Strothman and Company, a Louisville CPA firm, came up with 17 recommendations for UofL.

"We felt that the recommendations that we have made were all implemented, it would substantially reduce the possibility of at least significant frauds in the future," said Bill Meyer, a Strothman partner.

A lot of it comes down to taking different practices happening in UofL's various schools and departments and putting it under the accounting control of a chief financial officer, a person UofL is currently trying to hire.

"I refer to it as a super-CFO," said Meyer. "This is a person who would not only do CFO duties but would have more power to compel corrective action."

Ramsey said after the presentation that many of the recommendations are already changes UofL was making and pointed out that the schools own monitoring eventually caught many of the past fraud cases.

"When someone does something that they shouldn't do that breaks the law, we're going to go after them, we're going to prosecute, we're going to make it public and we've done that," he said.

The report must still be approved by the UofL Board of Trustees. They’re scheduled to do that at a July 10 meeting.

For a look at the complete auditor’s report, click here.

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