Former director McCormick, IT employee received cash and airline miles from extensive use of personal cards for MaineHousing purchases
Former director of Maine State Housing Authority (MSHA) Dale McCormick and one of her employees used their personal credit cards to make over $170,000 in purchases for MSHA, racking up cash rewards and airline miles for themselves, according to a report from the Office of Program and Governmental Accountability (OPEGA).
The OPEGA report uncovered the practice at MaineHousing, and since McCormick’s resignation in March, MSHA has put a stop to the questionable method of purchasing.
According to the report, in just five years McCormick was reimbursed $44,028 from MaineHousing, “most of which appear to have been charged on her personal credit card,” according to OPEGA, despite the availability of two company credit cards.
The OPEGA report also found that the MaineHousing IT director used a rewards-style Visa credit card for $127,000 in purchases, which could have resulted in as much as $1,270 or more in cash rewards or other points or gifts.
According to OPEGA, the excessive use of personal credit cards opened the door for “personal gain” by McCormick and the other employee, “in the form of cash back, points and other rewards.” A review of documentation at MaineHousing shows that at the time of the reimbursement for her purchases, McCormick used two different types of credit cards, first an American Express card that gave her Airline Miles as rewards, and later a Capital One Rewards MasterCard that advertises a cash back reward.
According to several credit card websites, these cards would typically expect to earn as much as one airline mile per dollar spent, or one percent cash back on each dollar spent.
Like McCormick, the IT Director at MaineHousing regularly used his personal credit card to rack up thousands of dollars in purchases that he was then reimbursed for through the agency. The IT Director was reimbursed a staggering total of $127,076 while working under McCormick, according to OPEGA. MaineHousing said it was common practice for the IT Director to make major computer purchases on his personal credit card and then seek reimbursement.
The IT Director’s reasoning for this, according to OPEGA, was because, “MaineHousing had given him the authority to purchase IT supplies from whatever Internet vendors offered best prices at the time, some of which would not accept purchase orders.” MaineHousing also said that many of the purchases exceeded the limit of the company credit card, but apparently not the limit of the IT Director’s personal card.
When asked for more details about the IT Director and his personal credit card, MaineHousing declined to provide information about him, asking that he be kept anonymous. “We respectfully ask that you do not publish the name of the Director of Information Services because he is not a public figure and we’d like to protect his privacy,” MaineHousing said in a statement.
MaineHousing said that the IT Director made the purchases with “MaineHousing’s management approval,” adding that they no longer permit the use of personal credit cards for such purchases.
Both McCormick and the IT Director likely would have seen additional gains in their credit scores as a result of the incurring, and subsequent payoff, of their personal cards through reimbursement.
The OPEGA report, finalized after the departure of former director McCormick, stated that this type of personal gain through use of personal credit cards was unacceptable. MaineHousing issued a response saying that MaineHousing has, “instituted a prohibition on employees’ use of personal credit cards for business expenses other than purchases associated with approved business travel.”
It is unclear if MaineHousing will seek reimbursement from McCormick or the IT Director for any rewards or cash received as a result of the frequent and excessive use of their personal credit cards.
If so, it wouldn’t be the first time the former director has had to pay back the Authority. The OPEGA report notes that McCormick was paid “duplicate” reimbursements on several occasions, and had to be contacted after her resignation to pay MaineHousing back for one of those duplicate reimbursement payments that hadn’t been noticed prior to the OPEGA report.
65 Comments
Another reason criminal charges need to be brought against McCormick. And the ‘ non-public ‘ figure IT Director should not skip out scot-free either. Time for some accountability.
Privacy be damned….name names! As long as public tax dollars go into MSHA, names of MSHA workers are public information.
There should be should be some strict rules to avoid any credit card related theft. This type of news are now common in news papers.
Perhaps the Credit Card Companies SHOULD contact McCormick and the IT guy for reimbursement due to fraudulent behavior.
I would say at this point we should Thank “The Maine Wire” folks
for making these articles available to read….Thank you Maine Wire.
You can best believe this article might be hard to find in the KJ or
PPH. Keep digging and eventually we will get to the bottom of this
stuff and bring Dale McCormick to Court, I can only hope for
such an outcome.
What a racket mccormick had going! Disgusting really!
Must have been nice, racking up all those cash and airline points on their personal credit cards, and then getting some duplicate reimbursements, too. In future years, McCormick will probably look back very fondly on the lucrative set-up she had going, with wistful memories of all that public largesse.
I’m sure the liberal supporters of McCormick and “IT Guy” will say they “deserved” the improper perk, because, gosh, they both “worked so hard.” Doesn’t make the practice any less improper, and against state policy.
The IT Director should be named, because he’s a public employee, who took advantage of a public financial entity for personal gain.
MSHA’s board meeting minutes reveal the names of all who attend, even the public. Why should an employee’s name be kept private?
https://docs.google.com/viewer?a=v&q=cache:GCQiT6sXpjMJ:www.mainehousing.org/docs/boarddocs/november-2011-meeting-minutes.pdf?sfvrsn%3D4+site:www.mainehousing.org+it+director&hl=en&gl=us&pid=bl&srcid=ADGEESjb5P6k6nkfOJ_3HqHiJUaHuYjIi4rZmxWg0DBeCYqsimQg9x8FPMBM0UO_wOzkwXLuOihiTiNM–vOvm6qVg6pfZKsOzpMcob5qqll_YfFZ0lQVPEOXAdtTpCtCfkH-mucErrd&sig=AHIEtbTqUdcm7kl6uds36ZQ0VD_N_vOHxg
I’d settle for him finding another job, and reimbursing MSHA for the improper cash rewards and airline miles.
I can see the temptation to do this. However, the reimbursement procedure takes time and is subject to error and fraud. The new policy is the correct one.
Mr violettes name wasnt protected??
I bet Bill a.k.a.”hound dog Lepage” is already getting ready to go after Dale on this one, NOT!
Come on now Les, Last week her daughter and all her liberal supporters said she was the most honest and hard working person they know. I think that tells us where her supporters hang out.
I know. I see no reason to shield any public employee from charges of violating state law or policy.
Hi!
Since two (2) agencies have been investigated, are there more to be investigated?
If not, there should be.
Additionally, personal gain at taxpayers expense is atrocious, and I consider it stealing.
Ms. McCormick should pay all the “gain” back to the agency, and her credit score is also an unfair advantage.
How did the taxpayers gain in all of this?
They didn’t; they lost instead.
“witch hunt”, eh? No wonder Ms. McCormick decided to resign “for the good of MSHA”. Had she stuck around to defend her “sterling reputation” who knows what additional rocks might have been peeked under. Augusta is long overdue for a good housecleaning, as is becoming more and more apparent.
All credit cards used by State employees should belong to the State.
The reward points belong to the people of Maine. Take her and her IT professional to small claims court to recover the dollar value of the points that they received fraudulently.
Dudley Gray
Maybe Bill Nimwitz can write a story about another D-Mac wrongdoing that’s really no big deal, just the R’s on another witch-hunt………….
This is why all entities ( ie government) fail… When the purse strings are our own we make better judgements…when the coffers are full of others money they spend and steal until they get caught.
I looked up the names of people when the MSHA downloads first became available. One of the names I looked up was Clif Graves. I’m glad I did, because he has since taken his website down. He listed his occupation thusly:
“My current “day job” is at MaineHousing where I am the database administrator for the Maine HMIS system.”
Anybody who is interested, let me know and I will send you the cached page. It’s insulting to those of us who really work at “day jobs.”
Also, would LOVE if someone would look into Brunette Catering. It appeared to have been used a lot in 2010, and I can find NOTHING about it any longer.
ANYBODY who thinks the MSHA used taxpayer dollars appropriately is either still working there or someone who used to work there and here’s Paul Violette’s name at night in their nightmares. THANK GOD for the Maine Wire!
Gosh, I do not see many of those people that were defending D Mac speaking out here? Oh where oh where could they be?
I post this information so people can get an idea of just how profligate the MSHA was with taxpayer dollars. These are expenditures for “BRUNETTE CATERING” for the months of August-DEcember 2010–I couldn’t go back further than that because it made me ill to see the waste. I include the dates so you can see for yourself that our “hard-working” MSHA apparently had “educational training” programs on 12/23/10 and 11/24/10 (yeah, right before THANKSGIVING AND CHRISTMAS, folks!!):
8/5/10: $85
8/12/10: $885
8/17/10: $1445
8/26/10: $85
9/2/10: $185
9/30/10: $754
9/23/10: $637
10/7/10: $785
10/28/10: $1360
11/4/10 $880
11/10/10: $165
11/18/10: $865
11/24/10: $923
12/9/10: $1522
12/16/10: $90
12/23/10: $142
(I also note that BRUNETTE CATERING got a $3465 check in January 2010~!!)That’s over $10,000 in catering from a LOCAL CATERER in Augusta in about four months. Are you kidding me? And remember, folks, this doesn’t even include their coffee, because they got THAT separately from Brewer’s Dairy and Carrabassett Coffee Company, which we ALSO paid for.This is simply appalling.
SHARON BRUNETTE BRUNETTE CATERING AUGUSTA ME $7,600
The above was taken from this website, that Naran apparently commented on some years ago, about where Libby Mitchell spent taxpayer dollars, and lo and behold, Brunette Catering is there too!
Here’s the link to the website:
http://www.asmainegoes.com/content/libby-mitchell-takes-maine-conservatives?page=1
I show payments in 2010 by MSHA of over $84,900 to Marjorie Love, who markets herself as an “Independent Consultant to Non-Profits.”
http://www.linkedin.com/in/marjorielovemsw
Seriously???!!!
Thank you, Susan. I appreciate the time you spent researching these issues.
How anyone could defend McCormick’s shoddy management of MSHA money is beyond comprehension.
Over the past decade, MSHA spent a lot of money on lobbyists and advertising. Money that should have been spent on creating housing, their actual mission.
The only good thing I can say about the profligate use of MSHA money on catering is that at least Sharon Brunette is a Maine resident and taxpayer.
Graves is listed on LINKEDIN as an “HMIS Specialist for MSHA.” I do not believe he is the IT Director in question.
After a while, it’s pretty hard to defend the indefensible.
I was not implying he was the IT director. My concern is that he has a fulltime “day job” with the MSHA, yet he runs a consulting business and has private clients for which he charges a fee. Take a look at his travel and education expenses with the MSHA. And then note where he mentions traveling to conventions in Boston and NYC to meet “his clients face to face.” I would hope someone looks into all the travel these folks at MSHA made to see if the expenses were directly linked to their positions at MSHA or if we were paying to for their private companies. See below:
http://tech.groups.yahoo.com/group/Information_Systems_Forum/message/9216
It sure looks like Dale McCormick ate from the taxpayers’ dinner plates every single day she worked at MSHA.
Also, I note that it appears that every board member was monthly compensated $55 –I would love to know if such a payment was authorized.
I note that Ms. Love received $11,000 (plus) compensation for one month. I find that incredulous.
And I note few, if any, such as “TYKE” are willing to post openly rather than anonymously.
Thank you for the clarification, and the additional details.
After the last two years, and all the public spending debacles that have been revealed in Maine, it would seem every state agency should be getting at least a casual perusal of expenses and spending habits, if not a full audit.
MSHA IT director is named Norman Breitner.
http://www.facebook.com/norman.breitner?sk=info
Same here, Susan. I am grateful that in future, such outrageous squandering of public money will no longer be tolerated at MSHA.
It appears you may be correct, Ganary. Thank you for the information.
From the FB page linked above by Ganary:
——————–
Norman Breitner
Housing Authority IT Director at State of Maine
Employers:
State of MaineHousing Authority IT Director · Apr 2000 to present · Augusta, Maine
————————-
OPEGA might want to review how many years any MSHA technical purchases didn’t go through the company credit cards.
Any rewards or cash resulting from such purchases should be repaid to MSHA, and Maine/US taxpayers.
Four to five catered events each month? For what? Training and education? If this was a REAL business office, and not one funded by the taxpayer and exempt, it appears, from any meaningful oversight, this business would be out of business quickly. As far as I can tell from perusing the expenditures for 2010, nobody in the MSHA actually worked, everyone was at a conference or training, and everybody ate for free. It makes me ill.
Yep. They’re real “brave” about posting personal attacks on others, while never using their real names.
A real medical miracle, how they manage to walk around with no spine.
People should take time to go back and read the minutes of the meetings of the MSHA when Dale was director. Take a look at the November 2011 minutes. http://www.mainehousing.org/docs/boarddocs/november-2011-meeting-minutes.pdf?sfvrsn=4 It’s at this meeting she reveals the true cost of the Elm Terrace projects–over $300,000!!! In particular:
“Commissioner McCormick gave an update on the Elm Terrace project. She stated that on August 31 we learned that the projected end price was going to be $314,000. At that time, we requested thedeveloper cut costs to $265,000 per unit. They have sent their response, and it will be reviewed by our Finance Committee.” BUT, GO BACK and take a look at the September 2011 minutes–NOTHING about Elm Terrace!!!! But they DO change the way the Commissioner has to report her mileage:http://www.mainehousing.org/docs/boarddocs/september-2011-meeting-minutes.pdf?sfvrsn=2 “Deputy Director Adam Krea distributed a spreadsheet showing taxable fringe benefit adjustments that will be made to the Director’s taxable income for 2008, 2009, and 2010. After consulting with Baker, Newman, and Noyes, MaineHousing will issue amended W-2 tax statements so the Director will be able to file amended tax returns for the three years. Given the nature, size, and steps taken to rectify the error, Adam stated that this does not pose any risk to MaineHousing. The process of tracking business miles drive by the Direction has been changed. She will keep a log tracking actual miles driven for business purposes.”
For all you who think there was NO FRAUD at MSHA, guess again. They started cleaning it up last year…
Thank you. I will never be dissuaded from believing that MSHA money was squandered, foolishly misspent, and wasted.
In 2010, Norman Breitner, IT Director for MSHA, was reimbursed for “education/training” and “computer supplies” a total of $25,522.
Crooks! They deserve to be indicted for stealing.
What/where is the source indicating the $84K payment to Marjorie Love? This info is not in OPEGA report I reviewed.
Would like to examine the source….interesting.
There’s a new story in the PPH, trying to say exactly that, Gran — that the R’s engaged in a “witch hunt.”
Based on the continued revelations of improper spending and financial transactions at MSHA, I’d say the Republican concern is vindicated.
I downloaded all the expenditures released by MSHA in response to the FOA act. I found it online. It makes for infuriating reading. For example, take a look at the reimbursement staff members got for attending educational/training programs. I culled these numbers for only HALF a year (June1 through December 31, 2010):
Cary Thomas–attended eleven seminars/programs
Cindy Namer: THIRTEEN
Adam Krea–eight
Karen Rose, five
Nancy Firtz six
Lori Johnson, four
Deborah King-Johnson, six
Clif Graves three
Dale McCormick, three
Peter Merrill, four
Laurie Glidden, four
Shawn Roy, four
David Drost, four
Amanda Ouellette, three
Daniel Brennan, three
Jennifer Boardman, three
Paula Weber, three
These people were being paid to work and yet they had to attend all these trainings?? What does this say about their competency to hold these positions in the first place??
I’d amend that to say that the state should provide state credit cards to its “frequent travelers”. It’s a fact that managers and some other employees are going to have to travel (sometimes too much) for “official purposes” and they should be reimbursed for all appropriate expenses. If they were required to use a state-owned credit card, it would be easier to keep track of expenses and to make sure that the reimbursements were appropriate.
We can argue over whether the expenses for which Ms. McCormick was reimbursed were proper, but for this discussion let’s suppose they were. In that case, I can’t see what harm was done here. Yes, Ms. McCormick profitted by using her personal credit card, but was that against any rule; was there any prohibition against such use? What harm was done to the people of Maine? Did the state of Maine lose any money because of this? And I’d be willing to bet that there are a lot of other folks throughout state government who are saying “Oh, crap!” because they’re doing the same thing. If it’s deemed to be inappropriate, there should be a state-wide policy against the practice. Or perhaps any “perks” from the use of personal credit cards could be considered income and be taxed and/or off-set against salary.
I don’t know for sure, but I don’t think government entities can benefit from “frquent flyer miles”, “bonus points”, etc. Instead, they usually contract with a credit card company to provide credit cards at a “group rate”.
Whether or not state employees use their personal credit cards or state-provided credit cards, it comes down to integrity. There’s a certain percentage of people who will abuse the system, but we should have a good enough system to provide over-sight and to audit all expenditures of taxpayer dollars.
Particularly in an age where online streaming is available, or access to DVD’s and other media sources, it becomes increasingly difficult to justify actual trips to various conventions and meetings.
Sometimes it cannot be avoided, but it should be attempted before spending taxpayer money on unnecessary junkets.
I apologize for being obtuse; perhaps (as frequently happens) I’ve missed something, but I don’t see how the taxpayers have lost anything in this, referring just to the issue of the “perks” that Ms. McCormick got for the use of her personal credit cards. To me, this is a separate matter from whether or not the expenditures were legitimate “offical business”
I think it rightfully calls into question whether or not these expenses, incurred on private credit cards, are incurred for the right reasons. Let’s see, a seminar in Augusta, that I can attend for free, or one on NYC, that I can put on my personal credit card, be reimbursed for AND receive credit card perks…
Bottom line is anyone trying to do anything in any legal sense to hold these criminals accountable?
Here’s the Maine State Gov source for the State Policy cited above:
http://www.maine.gov/bhr/rules_policies/policy_manual/6_5.htm
BUREAU OF HUMAN RESOURCES
HUMAN RESOURCES POLICY AND PRACTICES MANUAL
6.5 ACCEPTING GIFTS
It is against State policy for an employee to accept gifts from any
person or business that conducts business, or expects to conduct business, with the State of Maine.
Further, it is unlawful (Title 17-A M.R.S.A. Sections 602, 604, 605 and 606) for persons or businesses to give gifts to State employees and
for State employees to accept gifts that are intended to improperly
influence the State employees in the exercise of their duties.
For the purpose of administrative guidance, gifts do not include
advertising items of nominal value such as calendars, pens, or pencils.
However, goods and services which involve a pecuniary benefit should be considered to be gifts.
I’d like to see somebody who could prove that airline miles and cash rewards did not confer a “pecuniary benefit” to McCormick and Breitner.
The second portion of the OPEGA report is due out this coming fall. Time will tell as to whether criminal charges are warranted for McCormick, or not.
I agree that credit card charges, whether on personal or state-issued credit cards, should only be reimbursed “for the right reasons”.
State policy says that anything resulting in a “pecuniary benefit” to an employee is against the rules, and not allowed. (see the link and the language elsewhere on this page).
In truth, it doesn’t matter whether the miles/cash rewards would have benefited the state (although they would have).
What matters is that it wasn’t allowed.
blyvy-the biggest problem I see when reviewing the actual expenditures for the MSHA is that NO ONE, I repeat, NO ONE, seemed to be keeping an eye on how the money was being spent. If an employee can run up tens of thousands of dollars in expenses, and be reimbursed, who is saying “no’? Who’s checking to make sure those outlays of thousands of dollars are necessary and proper?
Based on my review–and granted, it’s limited, and it’s on the outside looking in, but NO ONE at MSHA had ANY concept of frugality. I can tell you as a state worker myself, we employees pay for our own coffee, our own cream, our own sugar, our attendance at any conference or training is scrutinized carefully and more often than not, rejected. We pass the hat to buy flowers for each other when family emergencies, celebrations, or funerals occur. We don’t eat lunch at a local restaurant and expect the taxpayer to pick up the tab. We don’t give vendors gift certificates paid for by taxpayer dollars. However, all these expenses were routinely paid for by the taxpayer for the employees at MSHA. It is all right there in the report from OPEGA and in the receipts released in response to the FOA request.
Additionally, also having worked for years in the private sector, is that if any business had been run as the MSHA appears to have been run, it would have quickly gone out of business. MSHA’s complete disregard for any kind of frugality or consideration for the taxpayer was simply appalling. I hope someone can find evidence of criminal behavior and seek restitution.
Under LD 1843, some 30 state quasi-governmental agencies will now be subject to regular reports and more stringent controls on spending, contracts, and procedures.
——————–
http://www.sunjournal.com/news/approved/0001/11/30/bill-seeks-more-oversight-quasi-state-agencies-lig/1167692
The changes …for nearly 30 identified agencies under
LD 1843 include: adopting more stringent policies for the selection of
vendors and ensuring that a competitive bid process is used whenever
possible; restricting any contributions to entities that directly
support an agency’s mission; limiting reimbursements for travel, meals and entertainment and prohibiting an agency from hiring an outside lobbyist.
The agencies also would be asked to submit regular reports on activities to the Legislature beginning in 2014.
Good points, Ms. Capehart.
I was a federal employee and traveled frequently on “official business”. Our claims for reimbursement (vouchers) were pretty well scrutinized. I was a union representative for over 30 years (Oh, the horror!!!), and agree that any claims should be closely audited. There’s a point though where it becomes over-kill. To have enough auditors and claims examiners to trace every single dollar becomes cost prohibitive. Looks like MSHA could have done much better, though, particularly with their managers. There needs to be a balance; “trust but verify”, I guess. The way you describe reimbursement at your worksite sounds reasonable to me from what you wrote.
Why isn’t that theft?
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