Baltimore, MD - The Department of General Services (DGS) does not monitor it’s the City’s fuel consumption effectively, which has led to documented cases of misuse and potential fraud, according to a biennial performance review of the agency performed by the Department of Audits (DOA). 

DOA also discovered that DGS had paid for the fuel of two municipal golf courses that are independently operated and managed by a non-profit organization, totaling $49,458 over seven years.

The biennial performance audit examined the effectiveness of DGS’s monitoring controls over City fuel inventory and distribution. Through its inquiry DOA found that:

• DGS has not established a system for monitoring fuel usage that could identify potential issues;
• Key controls to identify inventory shrinkage are not effective at certain fueling sites;
• Authorization, deactivation, and emergency card inventory controls are not working effectively. Among the documented case studies, auditors found one fuel card assigned to an employee, who retired in 2022, had 31 transactions after leaving the City, totaling $1,963.05 in fuel charges (DOA has referred this finding to the Office of the Inspector General for further review).
• Security cameras are note deployed at all manual sites.

DOA has recommended that DGS must improve its systems to properly monitor fuel usage and inventory balances and charges, and the regular changes in employee access.

Specifically, DOA recommended that DGS:

• Have a citywide process for agencies to monitor fuel usage to identify anomalies;
• Validate its operating procedures for recording daily and monthly inventory and usage were applied across all fuel sites;
• Document and manage fuel cards more effectively from issue to deactivation;
• Confirm whether operable cameras were installed at all fueling locations and
• Verify that all fuel costs were for City operations.

“Monitoring the city’s fuel usage is so important, and it is incredible we’ve gone this long without having safeguards in place. Among other glaring issues, our auditors discovered potential fraud concerning fuel usage,” Comptroller Bill Henry said. “It's crucial that DGS swiftly implement these recommendations. Urgent action is needed to prevent any additional problems.”

DGS has agreed to the recommendations and has provided an action plan, which can be found in the full audit report. A comprehensive audit explainer is also available from the Comptroller's Office. 

City Auditor Josh Pasch presented the biennial performance audit to the Baltimore City Board of Estimates at its Dec. 6th meeting.

Background

The Department of Audits (DOA) is the City's independent auditor, providing various audits, attestation engagements, and assurance services with the overall goal of improving government accountability. DOA is part of the Office of the Comptroller.