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Md. work group to audit COVID-related spending in state

Comptroller Peter Franchot criticized legislative leaders and the governor for not providing more pandemic relief funds. Spokesmen for Gov. Larry Hogan and Senate President Bill Ferguson shrugged off his complaints as being politically motivated and off-base.. (Bryan P. Sears)

Comptroller Peter Franchot, rebuffed earlier this year in his efforts to set up a pandemic spending oversight panel, will create a work group staffed by his aides to examine how COVID-19 spending was handled in Maryland. (The Daily Record/File Photo)

A new work group that will review pandemic-related spending, led by Comptroller Peter Franchot, will begin meeting in May, the comptroller’s office announced Wednesday.

The group aims to look at how the more than $50 billion in relief money the comptroller’s office says Maryland governments, businesses and residents received from the federal government was used, including whether money went to the intended recipients and what disparities exist in the spending. The group will also investigate “possible predatory fraud and pandemic profiteering,” according to a news release.

The comptroller will chair the work group, which will be composed of members of his office: Deputy Comptroller Sharonne Bonardi; the directors of the Comptroller’s general accounting and compliance divisions; and the directors of the Bureau of Revenue Estimates and the Office of Risk Management.

“The billions of dollars in federal and state aid has been essential for individuals and small businesses to survive the debilitating economic effects of the global pandemic, but we must make sure these dollars are being properly spent and bringing the greatest benefit to as many Marylanders as possible,” Franchot said. “At the same time, we need to determine if theft of taxpayer dollars has occurred through fraud and ensure that companies did not unjustly profit from pandemic aid while our friends and neighbors have been financially decimated.”

The comptroller, who has announced his candidacy for governor in 2022, originally proposed an oversight panel to the General Assembly in March, as the state was allocated billions of dollars as a part of the latest federal stimulus package, President Joe Biden’s $1.9 trillion American Rescue Plan Act.

Senate President Bill Ferguson shot the idea down, saying that Franchot and the legislature were both responsible for monitoring the use of the money and that a separate oversight panel was unnecessary.

The work group Franchot has created isn’t the same as the commission he proposed last month, but is instead an independent effort within his office. This is because language in Maryland’s fiscal year 2022 budget declares it the responsibility of the Office of the Comptroller to oversee the distribution of pandemic relief and submit four quarterly reports on how the funds were spent and whether any were used fraudulently.

“Comptroller Franchot has been the most vocal person calling for a full review, top to bottom, of these federal and state funds,” said Susan O’Brien, a spokesperson for Franchot, in an email to The Daily Record. “The Maryland General Assembly apparently agreed with the comptroller and this is why they included this specific language in the budget bill.”

Lawmakers fenced off $400,000 of the office’s budget for the review.

The work group will begin meeting in biweekly, live-streamed meetings beginning in May. Panelists will hear testimony from fraud detection experts as well as “firsthand accounts from Marylanders affected by mishandled pandemic relief,” according to the news release.

Meeting topics will look into pandemic profiteering at large companies, the ongoing audit of millions of tests purchased from South Korea and more.

The comptroller’s office will collect information from state agencies about how their relief funds were spent, as well as “fraudulent payments that may have been approved” and “what steps the agencies have taken to recover fraudulent expenditures.”

Reports of COVID-19-related fraud are under investigation by the Department of Justice. Maryland’s Emergent BioSolutions has been the subject of intense scrutiny after a manufacturing mix-up resulted in millions of Johnson & Johnson COVID-19 vaccines being ruined.

“Just as the DOJ is right to claw back any misspent federal dollars, someone in Maryland must assume the responsibility to ensure that our state’s share of federal relief dollars and expenditure of state funding were used for the most appropriate purposes and helped those most in need,” O’Brien said.

 

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