Hampden County retirement audit finds state law violations | #retirement | #elderly | #seniors
The state has audited the retirement board that controls the pensions of thousands of municipal employees throughout Hampden County
AGAWAM, Mass. (WWLP) – The Hampden County Regional Retirement Board controls millions of dollars in pensions for nearly 5,000 current and former municipal employees in the county. An audit of the Retirement Board released last month found multiple instances of questionable spending and illegal activity throughout a four-year period.
“I haven’t seen an audit quite as scathing as that one,” said Bob Markel, the Interim Town Administrator in Hampden.
A state commission known as PERAC, oversees the Hampden County Regional Retirement System. They are audited by PERAC every few years and the latest one from 2014 to 2017 found violations of state law and questionable payments.
Public Employee Retirement Administration Commission Findings:
- The Board employed two part-time attorneys, but Massachusetts law states that retirement boards must contract out their attorneys, which made this illegal. The Retirement Board also paid 90 percent of the attorneys’ health insurance benefits, totaling more than $250,000 over the course of the audit.
- The Board put three of its members on social security, which is another violation of state law.
- The Board paid more than $235,000 from 2013 through 2018 for services described as “search engine optimization” or “online directory listings.” These appear to have been scams and the Board continuously approved these expenses. The Board had no contracts for these services and had no documentation of monitoring the vendors’ performance or of any work product from the vendors.
During a phone call about the audit earlier this month, Richard Theroux, who has been on the retirement board for 30 years and is the current chairman, said the attorneys were not aware of these laws. But, Markel said the Board should have known better.
Public Employee Retirement Administration Commission
“We are required by the state ethics commission every December to basically go through a testing to make sure we know what is required of us ethically,” Markel explained.
Julianne Bartley is the Retirement Board’s executive director. She told the 22News I-Team that the board is making changes in response to the audit, including creating an “audit committee” that will look at the Board’s financial documents each month.
“We are making steps to correct these situations. we are also going to put in place with the help of PERAC internal control procedures and policies that will make sure these findings are not anything that will happen going forward,” Bartley said.
Markel told the I-Team officials in member communities like Hampden and Longmeadow want the five Retirement Board members to resign. “We do not have confidence that the members currently on that board will implement the changes that are necessary,” Markel said.
Theroux told the I-Team the audit’s findings were disturbing, but that “there’s not a member or a retiree that should be concerned with the system and getting their retirement checks.” He added that the Retirement Board was able to double its assets in the last 10 years. “The system is sound,” said Bartley. “Their money is safe.”
PERAC will now be in charge of reviewing the board’s day to day operations and making suggestions on what needs to change.