TENNESSEE: Company overcharged state for services: audit (Gov spendquist cronies)

The Knox News Sentinel ^ | 10/20/02 | AP

[GailA]

Company overcharged state for services: audit By The Associated Press October 20, 2002

CHATTANOOGA - A company owned by a longtime friend of Gov. Don Sundquist overbilled the state for work counseling the unemployed, an audit shows.

An independent audit of Chattanooga-based Workforce Strategists, which won a $1.9 million contract in 1999 without the state seeking competitive bids, shows the company in 2001 charged the Labor Department $138,600 for workers no longer enrolled in the program.

The company closed its doors Sept. 30 when its three-year state contract ended. A day later, FBI and Tennessee Bureau of Investigation agents removed documents from the company and interviewed staff members.

In a Sept. 26 letter to the U.S. Department of Labor, company owner John Stamps, a lobbyist and friend of Sundquist, said the $138,600 would have been paid to the company eventually, based on the total number of people it was counseling.

In the letter, Stamps wrote that "the effect is that we were compensated earlier than we should have been. However, we would have still received the same total compensation ... based on the number of participants we serve."

Stamps wrote that the company had an "understanding with the state" that it could bill for participants who continued to receive counseling longer than provided for in the state contract by substituting for people who dropped out of the program.

Stamps could not be reached by telephone for comment. Sundquist spokeswoman Kriste Goad said the administration did not want to comment "until this whole process is complete."

An audit by a Chattanooga accounting firm, Wilkins, Crews and Henderson, discovered the irregularity.

The audit was prepared for the state comptroller's office, which is also investigating the company.

[GailA]

You can read about the cronyism and corruption here: News 5 This company was just SIX DAYS OLD when they were awarded this contract with NO bids by other companies.

[NewCenturions]

"counseling the unemployed"

They couldn't come up with another excuse for a business?!

[ghostrider]

A company owned by a longtime friend of Gov. Don Sundquist overbilled the state for work counseling the unemployed, an audit shows.

Yup! Outsourcing is the new taxpayer "sting." Political cronies gobbling up the state and Federal budgets. Outsourcing is the biggest "land grab" scam in the history of the world. Trillions of dollars are up for grabs.