May 15, 2021

Reports issued during the week ending May 14, 2021 by the New York State Comptroller

New York State Comptroller Thomas P. DiNapoli announced the reports listed below during the week ending May 14, 2021. 

 

Reviews of adopted 2021 budgets

Auditors conducted reviews of 20 adopted budgets of various counties, cities, towns and villages across the state to assess whether local officials adequately considered the impact of the pandemic on their financial operations while developing their 2021 fiscal year budgets. Below are the findings of some of the communities reviewed:

Click on the text highlighted in color to access these reviews.

Adequacy of 2021 Budgets - Town of Bolton (Warren County) Auditors found that officials for the Town of Bolton adequately assessed the impact of the pandemic on financial operations while developing estimates for significant revenues and expenditures in the 2021 adopted budget. Due to uncertainties in available state funding for highway improvements that were planned to be made in 2020, officials delayed highway improvements from 2020 to 2021. The delays carried over their 2020 revenue estimate for state funding to 2021.

Adequacy of 2021 Budgets - Town of Elma (Erie County) Auditors found that officials for the Town of Elma adequately assessed the impact of the pandemic on financial operations while developing estimates for significant revenues and expenditures in the 2021 adopted budget.

Adequacy of 2021 Budgets - Essex County Auditors found that Essex County officials adequately assessed the impact of the pandemic on financial operations while developing estimates for significant revenues and expenditures in the 2021 adopted budget.

Adequacy of 2021 Budgets - City of Jamestown (Chautauqua County) Auditors found that officials for the City of Jamestown adequately assessed the impact of the pandemic on financial operations while developing estimates for significant revenues and expenditures in the 2021 adopted budget.

Adequacy of 2021 Budgets - Town of Niskayuna (Schenectady County) Auditors found that officials for the Town of Niskayuna adequately assessed the impact of the pandemic on financial operations while developing estimates for significant revenues and expenditures in the 2021 adopted budget. However, officials balanced the 2021 adopted budget by including negative appropriations totaling $663,254. Those funds were identified as “2021 budget challenge” across departments in the general fund, highway fund, water district and two sewer districts. When adopting the budget, officials did not identify the specific appropriations in each department from which these budgeted cost savings would be realized nor did they develop a cost savings plan. This is not an appropriate budgeting method. As a result, the board adopted an out of balance budget.

Other audits released:

City of Amsterdam - Budget Review (Montgomery County) Auditors found that certain significant revenue and expenditure projections in the 2021-22 proposed budget are not reasonable and identified other matters that require city officials’ attention. The proposed general fund budget includes estimated revenues of $975,000 for federal aid anticipated to be received by the city through the Federal American Rescue Plan Act of 2021. The timing of the receipt of funds from the Act is uncertain at the time. Once received, the funds will come with restrictions on what they can be used for. The proposed budgets for the general and recreation funds are not structurally balanced because they include subsidies from other funds to finance their operations.

City of Long Beach – Budget Review (Nassau County) The city's financial condition remains in significant fiscal stress. The proposed general fund budget of $93.6 million is structurally imbalanced because the city continues to issue debt to finance recurring operating expenditures. The continued reliance on proceeds of long-term debt to finance recurring operating expenditures will further diminish the city's ability to finance needed services in future budgets. The city's proposed budget includes a tax levy of $50.5 million, which is $3 million above the legal limit, unless the city council overrides the tax levy limit. The proposed budget also includes a 4 percent water rate increase. However, at the time of the review, the city council had not authorized the rate increase. Based on the city's historical overtime cost trends, the city's overtime appropriation appears insufficient. City officials did not include cash flow projections in the proposed budget. Although not required, cash flow projections would provide officials with another gauge of the effectiveness of the proposed budget. City officials developed a "budget timeline," but they never confirmed an actual budget adoption date.

Town of Springfield – Accounting Records and Reports (Otsego County) The current supervisor did not maintain complete, accurate and timely accounting records and reports. As a result, the board was not provided with the necessary financial reports and information to properly oversee town finances. During the audit period, the current supervisor did not prepare bank reconciliations, record receipts in the financial accounting software, or provide the board with detailed monthly budget-to-actual reports. In addition, the annual financial reports required by the State Comptroller’s Office were not filed. The board did not annually audit or provide for an audit of the supervisor’s records and reports, as required.

Town of Springfield – Credit Card Purchases (Otsego County) The town board did not ensure credit card purchases were adequately supported, for legitimate purposes or approved before payment. Credit card statements were mailed to the prior supervisor and not provided to the board. They were also not always reconciled with supporting documentation before approval. The board approved payment of 116 credit card purchases totaling $18,014 without adequate supporting documentation. Auditors were unable to determine the appropriateness of an online shopping membership totaling $420 and they were unable to locate a ladder purchased for $585. Credit card reward points worth at least $1,250 were redeemed during the audit period. Auditors were unable to determine whether these points were redeemed to benefit the town.

 

Identity Theft complaints in New York State

Another Report issued by the Comptroller on May 14, 2021 noted that Identity Theft complaints in New York State in 2020 was 85% greater than in 2019.

Identity thefts in New York surged during the pandemic with more than 67,000 complaints filed statewide in 2020, which was 85 percent more than the previous year and more than four times the annual total from a decade earlier, according to a report released by the Comptroller.

The New York City metropolitan area had the highest rate of identity theft reports to the Federal Trade Commission (FTC) per capita at 403 reports per 100,000 people, followed by Poughkeepsie-Newburgh-Middletown (315) and Rochester (303) metropolitan areas.

The COVID-19 era has been marked by new varieties of financial fraud, including new identity theft scams. Although the full impact of the pandemic on the problem is not yet known, the Comptroller said that "New Yorkers should be aware of potential scams and guard against them."

The FTC has compiled identity theft complaints related to COVID-19 for 2020 through mid-March 2021, reporting 3,617 in New York. Of the state’s identity theft reports, about two-thirds (2,375) were related to information misused to try to get a government document or benefits such as economic relief checks or unemployment insurance.

According to the FTC, imposters are filing claims for unemployment benefits using the names and personal information of people who have not filed claims. People learn about the fraud when they get a notice from the state unemployment benefits office or their employer about their supposed application for benefits. As of late April 2021, the state Department of Labor (DOL) said it had identified over 1.1 million fraudulent unemployment benefit claims during the COVID-19 pandemic, preventing more than $12.3 billion in stolen benefits.

Comptroller DiNapoli’s office began an audit of the DOL in February. His office first conducted an assessment of the risk of potential identity theft fraud since the beginning of the pandemic, which included looking at complaints, large increases in payments, new programs and criteria, and changes to the internet technology. This assessment found numerous red flags that led DiNapoli’s office to launch a full audit.

Identity thieves have also attempted to leverage news of government COVID-related stimulus payments by posing as someone from an official organization and asking for personal or financial information. They have also tried to exploit pandemic fears by asking victims to pay out of pocket to get a COVID-19 vaccine or to put their name on a vaccine waiting list and, in the process, take their Social Security, bank account or credit card information. 

Private businesses that collect and maintain personal information must redouble their efforts to safeguard such data, DiNapoli said. He called on social media companies to promote best practices and proactively educate users about ways to keep private information confidential.

The Comptroller recommends the following actions, among others, to help prevent becoming a victim of identity theft:

1. Carry only the credit and bank cards you need;

2. Use two-factor authentication for online security where possible;

3. Use a password manager or strong passwords, including a mixture of capital letters, numbers, and symbols, and change passwords frequently;

4. Check bank or credit statements regularly; and

5. When online shopping, look for indications that the site is secure, such as a secure URL that begins with “https” (rather than “http”) and a lock icon near your browser’s location field.

Click on The Increasing Threat of Identity Theft to access the Comptroller's report posted on the Internet.

 

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