My termination from the Controller’s Office and the scandal that Alan Butkovitz doesn’t want you to know about
On November 13, 2012, City Controller Alan Butkovitz quietly issued an audit report of Philadelphia’s Cultural and Commercial Corridor Fund. There was no press conference or any of the usual publicity that accompanies the release of a new audit report from the Controller’s Office. The truth is that Alan Butkovitz is embarrassed of what is contained in the audit report, and he is even more embarrassed of the facts that are omitted in the report. The audit report can be found at this website link below, and my story appears underneath the website link:
As an Auditor for the Philadelphia City Controller, I was assigned to audit the Cultural and Commercial Corridor Fund in July 2011. The Cultural and Commercial Corridor Fund was established in December 2006 and was financed by proceeds of $135 million in municipal bonds issued by the City of Philadelphia. Half of these funds were intended to be provided as grants to cultural and arts organizations for them to make capital improvements (examples include building improvements, HVAC repairs, bathroom renovations) to their infrastructures so that these organizations could better contribute to the City’s cultural and artistic communities.
During my investigations, I discovered that almost $2.2 million was provided to an organization called the New Freedom Theatre, and the grant money was used by this organization to pay off delinquent IRS payroll taxes along with the interest and penalties associated with delinquent tax, delinquent City of Philadelphia Water Department bills, delinquent PECO bills, and various bank loans that were overdue (a detailed breakdown of these expenditures can be found on page 4 of the audit report). There was no provision whatsoever for the money from the Cultural and Commercial Corridor Fund to be used for past due bills and operating expenses, therefore, I believe that such usage was entirely illegal. Ironically, almost as soon as the New Freedom Theater got the $2.2 million grant from the Cultural Corridor Fund, the organization ceased production of theatrical performances. Currently, the New Freedom Theater only runs a summer drama camp for youth, and they rent out their facilities to other performing artists. The New Freedom Theatre got a bailout, and the arts community in the City of Philadelphia received very little in return.
In a truly pathetic attempt to make himself appear to be a prudent fiscal watchdog, Butkovitz used his audit report of the Cultural and Commercial Corridor Fund to criticize the Commerce Department for allowing the New Freedom Theater to use its Cultural Corridor Fund grant to pay for improper expenditures. On page 20 of the report (in the Agency Response section), however, Deputy Mayor Alan Greenberger points out that the Controller’s Office signed off on each and every payment made by the Commerce Department. As a matter of fact, it was Alan Butkovitz’s own Pre-Audit Deputy Controller (the official in charge of approving expenditures before the City pays for them) for the Philadelphia Controller’s Office that signed off his approval for the grant issued to the New Freedom Theater to be used for paying off all its delinquent bills.
I was one of the first people to discover the New Freedom Theatre scandal in early November 2011, and I immediately reported the issues to my Audit Supervisor. My Audit Supervisor then notified the Post-Audit Deputy Controller (the official in charge of auditing expenditures incurred by the City after the expenses are paid). The Post-Audit Deputy Controller then asked for my Audit Supervisor and me to meet him in his office to discuss the matter. The Post-Audit Deputy Controller stated that he intended to move forward with issuing an audit report about the Cultural and Commercial Corridor Fund, however, he planned to omit any mention of the New Freedom Theater. I told the Post-Audit Deputy Controller that I did not feel comfortable signing off on an audit report like that. The Post-Audit Deputy Controller just gave me a dirty look and told me that the Philadelphia City government and the Controller’s Office could not afford the embarrassment that the New Freedom Theatre grant had the potential to cause.
Both my Audit Supervisor and I were ordered to continue working on the audit of the Cultural and Commercial Corridor fund until early December 2011. Alan Butkovitz and his Deputy Controllers then decided to completely sweep everything under the rug with regard to the audit of the Cultural and Commercial Corridor Fund despite the facts that months of work were put into the audit and that major fraud was discovered during the investigations. In early December 2011, the audit was closed without a report being issued, however, the Controller’s Office later resurrected the audit in April 2012. On page 20 of the audit report (in the Agency Response section), Deputy Mayor Alan Greenberger blasts Butkovitz for this completely unprofessional behavior. What the report does not reveal, however, is that the true reason Alan Butkovitz resurrected the audit is because I had contacted two news reporters who started to question Butkovitz about the scandal and hinted that news stories might be written about Butkovitz trying to cover up the scandal.
Although I was never told that my termination on December 9, 2011 was a direct result of my refusal to sign off on the Cultural Corridor Fund audit, it is obvious that the two events are connected. The stated reason that was used to fire me was a comment that I wrote on an anonymous survey about a presentation given to the office. I was confronted about the anonymous survey at a disciplinary hearing on October 24, 2011. I easily could have lied when I was questioned about what I wrote on the anonymous survey; but I owned up to what I wrote, apologized for it, and promised that it would never happen again. There was no explanation given to me about why it took so long for the Controller’s Office to make its decision to fire me for something that I admitted to almost a month-and-a-half prior to my termination. Both Philadelphia Weekly Newspaper and Forbes Magazine published articles about how completely absurd it was for me to be fired for what I wrote on that anonymous survey. The articles can be viewed on the following websites:
As stated in the articles, my work performance ratings at the Controller’s Office were very positive, and my credentials as both a CPA and an MBA made me exceptionally qualified for my Auditor position. In addition, I was also planning on pursuing an MPA degree from the Fels Institute at Government at the University of Pennsylvania to further add to my ability to serve in my position with the Controller’s Office. I was well-liked by my co-workers at the Controller’s Office, and before I spoke out against the Alan Butkovitz’s unethical behavior, the Post-Audit Deputy Controller told me that it would only be a matter of time before I was promoted to an Audit Supervisor position.
My official notice of termination stated that the the comment that I wrote on the anonymous survey placed me “at high risk for embarrassing the Controller’s Office, discrediting the professionalism of the office, and causing unwanted negative publicity”. At the same time, the Pre-Audit Deputy Controller still has his job despite the fact that Alan Butkovitz has known for at least a year that the Pre-Audit Deputy Controller signed off his approval for millions of dollars in improper expenditures. The reality is that Alan Butkovitz is a dishonest and corrupt Controller, and he did not like the idea of having an employee who refused to help him cover up the Cultural Corridor Fund scandal by signing off on a misleading audit report.
After I was terminated on December 9, 2011, a security officer followed me to my cubicle and searched me down along with all of my possessions to make sure that I was not taking home any incriminating documents relating to the New Freedom Theatre scandal. My co-workers who witnessed the incident got the impression that I had stolen something from the office or committed some other kind of criminal act, and it was a completely degrading and humiliating experience for me. Two weeks before I was terminated, I found out that my wife was pregnant with our first child, and it was also a couple of weeks before the winter holidays. What should have been the best time of my life was a nightmare thanks to Alan Butkovitz, the miserable Scrooge who approved and upheld my termination. My daughter was born on July 7, 2012, and I still have not found another job in the accounting field.
Read a legal analysis of the circumstances surrounding my termination at www.lawyers.com