Austin officials have hired an outside lawyer to investigate the director of a city department tasked with shielding the city from fraud and waste amid allegations that he might have improperly used city resources, the American-Statesman has learned.
City Auditor Kenneth Mory has been the target of an inquiry since at least mid-May, according to interviews and documents obtained under Texas open records laws. He remained on the job as of Thursday.
Officials are paying Austin attorney Jim Cousar up to $56,000 for “legal advice and guidance concerning matters relating to the city auditor,” according to a 10-page contract, but the document provided no specifics.
However, City Council Member Sheryl Cole said in a recent interview that “we are diligently investigating some allegations against the city auditor of potential misuse of city funds.” She declined to comment further.
Mayor Lee Leffingwell also confirmed the inquiry this week but wouldn’t elaborate.
“It is a personnel matter,” he said.
Other council members didn’t return calls seeking comment.
Mory told the American-Statesman last week that Cousar had interviewed him recently as part of the inquiry, but that “I don’t even know what the allegations are.”
Mory said that based on Cousar’s questions, he thinks the inquiry might focus on travel plans in recent months that involved speaking engagements at several professional auditing association conferences. Mory said such plans might have sparked concerns from someone in his office about whether the city was paying for his travel since Mory was also getting a stipend as a conference presenter. He said in those instances, the city paid for none of his expenses.
“He just asked me some questions about some travel plans that I had, and how it was all set up and those kinds of issues, but the allegations weren’t made clear to me,” he said.
Cousar didn’t return calls seeking comment. According to his city contract, he isn’t allowed to talk to the media without prior approval from the city attorney.
Cousar, who is being paid an hourly rate of $425, has submitted a preliminary report of his findings to council members — the auditor’s position is one of only a few that is directly overseen by the council. However, the document is considered covered by “attorney-client privilege,” and officials declined to release it.
Last week, council members were set to conduct Mory’s annual performance evaluation, but postponed the review indefinitely “based on the facts in the report that we received,” Leffingwell said.
In his job, Mory oversees a group of special investigators “devoted to investigating allegations of fraud, waste and abuse in the city of Austin,” particularly those involving city contractors and subcontractors, such as theft or misappropriation of city resources and falsification of government records. The agency also does performance audits of city operations and follows up on previous audits to ensure city departments are following recommendations.
Mory, who earns $143,000 a year, has worked for the city since December 2009.
According to an online biography on the city’s website, Mory has worked for 30 years in government and for private businesses. It said he has been published in several professional journals and “is a frequent speaker at professional seminars.”
In recent months, Mory’s office has completed reports that showed, for instance, that the city has yet to spend nearly $7 million of $16 million in fees it had collected from developers since 1985 to build or renovate parks; that the city’s Emergency Medical Services agency had lost up to $345,000 in revenue by failing to properly bill Medicaid; and that some Austin hotels weren’t paying a nearly 9 percent city tax imposed on hotel stays.