DA finds no criminal misconduct in SamTrans accounting probe

By Drew Himmelstein | Bay City News Service

San Mateo County District Attorney Steve Wagstaffe has concluded his office’s investigation into allegations of improper accounting practices at the San Mateo County Transit District after finding no evidence of criminal misconduct.

Two former SamTrans employees, David Ramires and Ling La, set off the investigation earlier this year when they came forward alleging that funds were being funneled into accounts that could be dipped into for unauthorized projects or expenses, according to Wagstaffe.

Two accounting firms investigated the claims but did not find evidence of criminal violations or indication that money had been “embezzled, lost or otherwise unaccounted for,” Wagstaffe said in a letter to SamTrans’ attorney David Miller.

However, the investigation did find “inappropriate accounting entries” in SamTrans’ books, Wagstaffe said.

SamTrans has already corrected the mistakes found in the investigation and is implementing recommendations by auditors to avoid future problems, according to SamTrans spokeswoman Jayme Ackemann.

These changes include upgrading the agency’s finance software and adding more staff to the accounting department, Ackemann said. “Between more oversight and more technology, we have a better shot at catching mistakes,” Ackemann said.

Ramires and La refused to cooperate with the first accounting firm involved in the investigation, Maze and Associates, which is the accounting firm that currently works with the district, Wagstaffe said.

For this reason, the district attorney’s office hired an independent accounting firm, MGO Certified Public Accountants, to investigate the claims.

A partner at the accounting firm noted that “the vague and unsupported nature of some of Ramires’ contentions made substantiation of the claims impossible,” according to Wagstaffe.

La has sued SamTrans, claiming the agency retaliated against her for whistleblowing, according to her attorney, Dow Patten.

Patten said that while the district attorney’s investigation was sound, it suffered from not being conducted by a forensic accounting firm familiar with criminal cases.

“When you don’t have full access and you don’t have a forensic accountant, you’re not going to be able to track down every expenditure and find out, where did this expenditure come from?” Patten said.

Patten said La was particularly concerned that the agency was not using proper competitive bidding procedures for contracts as legally required. But the findings of accounting irregularities support La’s claims, Patten said.

“What we do know is, her complaints have been justified,” Patten said.