RD420 - Office of the State Inspector General: Fiscal Year 2017 Annual Report to the Governor and the General Assembly of Virginia – October 2017

Executive Summary:

In accordance with Title 2.2 Chapter 3.2 (§§ 2.2-307 through 2.2-313) of the Code of Virginia, the Office of the State Inspector General (OSIG) is responsible for:

• Investigating complaints alleging fraud, waste, abuse or corruption by an executive branch state agency, non-state agency or officers, employees or contractors of those agencies;

• Administering the Fraud and Abuse Whistle Blower Reward Fund;

• Overseeing the State Fraud, Waste and Abuse Hotline;

• Conducting performance reviews of state agencies;

• Providing training and coordination of standards for the state’s internal audit functions;

• Performing inspections and making policy and operational recommendations for Behavioral Health and Developmental Services facilities and providers; and

• Reviewing operations of the Virginia Tobacco Region Revitalization Commission.

Consistent with these responsibilities, OSIG completed the following activities during FY2017:

• Performance Review Services

o Published six performance reviews and one performance audit;
o Issued 38 findings and observations;
o Issued 58 performance review/audit recommendations;
o Conducted one follow-up review; and
o Completed one special project review.

• Behavioral Health and Developmental Services

o Published four unannounced inspections reports; and
o Received and coordinated responses to 49 complaints (reviewed seven complaints in-house, referred nine to the Department of Behavioral Health and Developmental Services and 33 to facility directors, local community services boards and other agencies/organizations).

• Investigations and Law Enforcement Services

o Opened 10 executive branch agency investigations;
o Investigated allegations of fraud, conflict of interest, misappropriation, procurement violations and ineffective management;
o Referred seven cases to the Office of the Attorney General; and
o Closed 22 cases.

• State Fraud, Waste & Abuse Hotline

o Assigned 645 cases for investigation;
o Of cases closed, 23 percent were substantiated, 45 percent were unsubstantiated, 21 percent were referred to other agencies, and recommendations to improve internal controls or policies were issued in 11 percent of unsubstantiated cases;
o Investigated 28 cases in-house because allegations involved an agency head, an agency internal audit employee or an “at-will” employee; and
o Completed two follow-up investigative reviews for compliance with recommendations.

• Internal Audit Oversight and Training Services

o Conducted four Quality Assurance Reviews;
o Offered nine training courses to 326 individuals; and
o Determined OSIG’s free and reduced-cost training resulted in savings of $165,000 to state agencies over comparable course offerings from private vendors.

• Communications and Outreach

o Presented before 15 state and national organizations;
o Responded to 115 Freedom of Information Act (FOIA) inquires; and
o Drafted and distributed six news releases resulting in multiple statewide media placements.