There’s room for fraud in the state’s current method of collecting and recording certain commercial vehicle registrations, according to an audit released today by the state comptroller’s office.
The findings show multiple problems in the Motor Carrier Section. That office collects more than 50 million dollars per year in registration fees for long-haul trucks. The reports says clerks have the ability to edit records, with no sign of any changes being made. There’s no real inventory of tags and decals to check against collections. Reciepts don’t always include the amount paid, and some are missing altogether.
State auditor Art Hayes:
“It’s very difficult to have proper accountability and to really know what has been receipted. There’s a high risk of fraud when you have these circumstances.”
Specifically, the report states that that workers could easily sell the tags and pocket the money, or that a company could be registered without making a payment.
Hayes says the Revenue Department is now investigating to see whether any actual fraud occurred.
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The job of titling and registering vehicles was transferred from the Safety Department to the Department of Revenue two years ago. The audit began about six months later; the problems seem to predate that switch.
There were a total of four findings. From the Comptroller’s office press release:
The following findings and recommendations, including responses from the Department of Revenue’s management staff, are included in the report:
1.
With the absence of effective controls and heightened risk of fraud in the Department of Revenue’s Motor Carrier Section, neither management nor the auditors could ensure that all cash receipts for registration fees were collected and recorded. http://www.comptroller1.state.tn.us/repository/SA/ag07043.pdf#Finding_1
2.
The Department of Revenue’s Tax Enforcement Division and Motor Carrier Section failed to adequately communicate in order to effectively update the dishonored checks list, and the Tax Enforcement officers did not effectively pursue collection of dishonored checks. http://www.comptroller1.state.tn.us/repository/SA/ag07043.pdf#Finding_2
3.
Management of the Department of Revenue did not adequately mitigate the risks of fraud, waste, and abuse relative to motor vehicle registration revenue collections in the Motor Vehicle Title and Registration Division. http://www.comptroller1.state.tn.us/repository/SA/ag07043.pdf#Finding_3
4.
The department has not established adequate controls over purchases made through E-Way, increasing the risk of unauthorized purchases. http://www.comptroller1.state.tn.us/repository/SA/ag07043.pdf#Finding_4
Hayes is quick to emphasize that the Revenue Department seems to be taking appropriate action when it comes to investigating the problems.
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