Report I2002-1 Summary - June 2002

Investigations of Improper Activities by State Employees


July 2001 Through February 2002


State employees engaged in improper activities, including the following:


The Bureau of State Audits (bureau), in accordance with the California Whistleblower Protection Act (act) contained in the California Government Code, beginning with Section 8547, receives and investigates complaints of improper governmental activities. The act defines "improper governmental activity" as any action by a state agency or employee during the performance of official duties that violates any state or federal law or regulation; that is economically wasteful; or that involves gross misconduct, incompetence, or inefficiency. To enable state employees and the public to report these activities, the bureau maintains the toll-free Whistleblower Hotline (hotline). The hotline number is (800) 952-5665.

If the bureau finds reasonable evidence of improper governmental activity, it confidentially reports the details to the head of the employing agency or to the appropriate appointing authority. The employer or appointing authority is required to notify the bureau of any corrective action taken, including disciplinary action, no later than 30 days after transmittal of the confidential investigative report and monthly thereafter until the corrective action concludes.

This report details the results of the six investigations completed by the bureau and other state agencies on our behalf between July 1, 2001, and February 28, 2002, that substantiated complaints. Following are examples of the substantiated improper activities and actions taken to date.


An employee used state resources to copy and sell compact discs (CDs). Specifically, the employee used an Office of Criminal Justice Planning (OCJP) CD burner to copy CDs that he then sold for a "donation" of $5. He sold at least 30 CDs and gave away at least 18 more. The employee also used the OCJP's e-mail system to distribute lists of the CDs he had available for sale. The employee resigned after the OCJP initiated termination proceedings against him.


An executive improperly accepted $4,000 from a non-state entity for serving on an advisory panel that was related to his job at the Contractors State License Board (CSLB). The executive also used the influence of his position to circumvent civil service hiring procedures in connection with a person he sought to hire as an employee. The executive first directed a public relations contractor, whose contract renewal was pending, to hire the person to perform work for the CSLB. This contractor paid the employee $6,825 for six weeks' work in November and December 1997 on behalf of the CSLB, but the CSLB never reimbursed the contractor for those payments. The CSLB then, in 1998, illegally made an emergency appointment and then a permanent appointment of this employee to a Career Executive Assignment (CEA). As a result of these improper appointments and at least four other CEA appointments that involved irregularities, the State Personnel Board revoked the CSLB's authority to conduct CEA examinations.

In addition, the executive failed to disclose pertinent facts regarding a traffic accident involving a state vehicle he was driving. The executive retired from state service before we completed our investigation. The State and Consumer Services Agency plans to provide briefings to key managers on ethical standards and is assessing what other measures it might take to prevent a recurrence of the types of behavior we reported.


The San Diego Coast District provided preferential treatment to Department of Parks and Recreation (DPR) employees and other individuals by allowing them to reserve campsites that are not on the public reservation system and by permitting them to use the sites for free. However, the DPR concluded that in some cases, allowing DPR employees such as lifeguards and rangers to camp for free added value and safety to the public because of the employees' special skills. The DPR has revised its policies and procedures to formalize when it will allow employees and others to reserve these "off-system" sites and when it can waive fees for those individuals.


An attorney used state equipment, a state employee, and courier services paid for by the State for activities related to his private arbitration and mediation business. Although the cost to the State was nominal, the attorney benefited in that he did not have to use any of the more than $18,000 he earned from his business from June 1998 through August 2001 to pay for the services. The California Department of Transportation is assessing what action it should take.


An attorney used the services of another Department of Justice (Justice) employee to assist him with paperwork related to his private arbitration business. We do not know how much this improper use of state time cost the State. However, this attorney earned at least $2,250 for arbitrating issues during 1998 and 1999. Justice is evaluating what action it should take concerning its attorney's actions. However, it reported that it will issue clarifications and reminders to its legal staff regarding incompatible activities.


A manager at the Substance Abuse Treatment Facility failed to perform his responsibility to maintain accountability over equipment and supply inventories and to report missing items. For example, although his subordinates had pointed out that items valued at approximately $1,000 were missing, he did not take any action. In addition, the manager was willfully insubordinate in that he refused to talk to investigators who were investigating this and other alleged improprieties. The Department of Corrections notified the manager that it would dismiss him effective October 18, 2001. However, the manager retired two days before the dismissal took effect.

This report also summarizes actions taken by state entities as a result of investigations presented here or reported previously by the bureau.

Appendix A contains statistics on the complaints received by the bureau from July 1, 2001, through February 2002, and summarizes the actions we have taken on those and other complaints pending as of February 28, 2002. It also provides information on the cost of improper activities substantiated since 1993 and the corrective actions taken as a result of our investigations.

Appendix B details the laws, regulations, and policies that govern the improper activities discussed in this report.

Appendix C provides information on actual or suspected acts of fraud, theft, or other irregularities identified by other state entities. Section 20080 of the State Administrative Manual requires state agencies to notify the bureau and the Department of Finance of actual or suspected improper acts. It is our intention to inform the public of the State's awareness of such activities and to publicize that agencies are acting against wrongdoers and working to prevent improper activities.

See the Index for an alphabetical listing of all agencies addressed in this report.