CNCS-OIG investigated allegations that a senior official at the Senior Community Outreach Services, Inc. (SCOS) Alamo, TX improperly managed aspects of its Senior Corps grant. An investigation by CNCS-OIG found that the SCOS senior official directed employees to falsify documents with the intent to double bill multiple grants (CNCS and HUD) and deceive grantors during compliance inspections and monitoring visits. Due to the poor state of SCOS’s financial records, CNCS-OIG, the CNCS Texas State Office, and the Department of Housing and Urban Development Office of Inspector General (HUD-OIG) were unable to determine if CNCS or HUD funds were expended appropriately. In addition, CNCS-OIG determined SCOS:
- Failed to Maintain Adequate Financial Records a violation of 2 CFR § 200.302 (a) and (b)(3), when it comingled various grant funds (public and private) without establishing an adequate accounting system to distinguish the sources of funding or explain how the funds were expended;
- Violated 45 CFR § 2551.25, Perform Work Outside the Scope of the Grant when a SCOS senior official performed work on other grants but charged 100 percent of his time to the SCP grant; and
- A senior official improperly charged portions of his salary to other grants, even though the salary was fully funded by the CNCS SCP grant, a violation of 45 CFR § 2551.25.
CNCS management concurred with our findings and issued a proposed termination of the SCP and FGP grants awarded to SCOS; however, SCOS voluntarily relinquished its SCP and FGP grants in lieu of termination. SCOS’s falsification of documents and poor financial records prevented any reliable analysis of its financial records. As a result, CNCS did not disallow any costs from the SCOS grants as it was unable to distinguish legitimate from improper expenditures.