By John V. Crangle
Common Cause of South Carolina
Embezzlement and theft of taxpayers’ money is rampant in this state. Research provided to the Senate at the request of Sen. Jake Knotts shows that in the past 10 years, the attorney general and solicitors have convicted people of embezzling $22 million from state and local government, in more than 600 cases.
The problem is actually worse, because law enforcement records are not organized in a way to make it easy to count all the cases. Beyond that, this doesn’t count undiscovered fraud that may never be brought to light.
False-claims bills in the Senate (S.100, S.1018) would encourage government employees and citizens to report crime to authorities, by protecting them against retaliation at work and rewarding them financially if stolen funds are recovered. Oftentimes, non-participants become aware of stealing by fellow employees but don’t report it. The Paul Moore scandal at the Department of Social Services, which involved some 200 people within and outside of the agency, was exposed when one of the conspirators went to authorities after falling out with Moore in a quarrel over the money. But this was only after $5 million had been stolen and squandered beyond recovery over several years. The false-claims legislation is designed to interrupt the stealing while the money still can be recovered.
The legislation, which complements the newly created office of inspector general, is a bipartisan effort by Sen. Knotts, Gerald Malloy, Vincent Sheheen and Mike Rose. At that first hearing on the bill, the attorney general’s office testified that South Carolina has been forfeiting 10 percent of the millions recovered by the federal government in Medicaid fraud in recent years because we do not have a federally approved false-claims law; this has cost the state $7.8 million in the past five years alone.
The Legislature needs to pass this law as soon as possible in order to cut short the losses, punish the embezzlers and fraudsters, recover stolen money and obtain South Carolina’s fair amount of the stolen Medicaid funds recovered by federal prosecutors. As Sen. Rose noted: “Either we are going to get serious about fraud in South Carolina, or we are not.” Taxpayers have the right to know that their tax money is not going to be stolen by crooked government employees and fraudsters and spent on drugs, alcohol, foreign vacations and strip clubs.
John V. Crangle is Executive Director of Common Cause of South Carolina, a member of the SC Progressive Network.