Anybody who hoped an independent probe would answer the question everybody had about how Galveston County lost more than $500,000 will be disappointed.

The report by Lubbock-based Dawson Forensic Group, which was issued Nov. 9 and made public Monday, scrupulously avoids assigning blame to anyone for the embarrassing and extremely large loss of public money.

“It is evident that our report fails to assign blame to a single department or even a single individual associated with Galveston County,” the report states.

“This is based on our conclusion that a department or individual cannot be held accountable for noncompliance with processes that may not have been properly designed or that didn’t exist.”

The report does take a weak stab at explaining how such a remarkable thing as getting ripped off for more than $525,000 happened. It does so in a sentence that stands as a monument to the grammatical passive voice’s ability to shield actors from their actions.

“The Event was able to be accomplished or accommodated due to:”

The report goes on to list three ways the $525,282.39 was enabled to get itself stolen.

“• a lack of understanding/training as to recognition of these types of attacks,

“• a lack of vendor information establishment/change validation processes, and

“• a lack of understanding as to which office/department had the responsibility for validating vendor information.”

At least one new detail about the theft did emerge thanks to the report. Our understanding had been the thieves convinced somebody in county government to send the money — the $525,282.39, that is — via electronic funds transfer to an account different from the one on record for Lucas Construction Co.

That, however, was not the case, according to the report. The fact is Lucas Construction had never been paid by electronic transfer before, but had been paid by old-fashioned checks, according to the report.

The scammers downloaded a form from a county website, filled it out and submitted it before consummating the theft. So, the scammers also convinced county employees or officials or both to create the fake account into which county employees or officials or both unfortunately deposited more than a half-million dollars.

That is a truly remarkable example of being asleep at all the switches.

Taxpayers who’d hoped for something like justice from the Dawson report, which they paid $14,000 more or less, can perhaps be forgiven for thinking that if nobody, exactly, is accountable for losing their money then everybody at the county should be held accountable.

Of course, the only real justice would be in finding, convicting and imprisoning the thieves; none of which seems very likely.

And in the meantime, somebody, maybe several somebodies, was responsible for those lacks of understanding, training, information and processes.

Lacks like that sure sound like leadership failures.

• Michael A. Smith

Michael A. Smith: 409-683-5206;


(13) comments

Don Schlessinger

Seems to me the 14K spent on investigation was a ripoff also. Save the county money and forget about the 539K we lost on the deal.

David Schuler

Never was the WWII phrase "good enough for Government work" more appropriate, Apparently, in place of real leadership willing to take responsibility, the County finance and purchasing department heads are more like Francesco Schettino, captain of the Costa Concordia.

David Hardee

The time has come for this incident to be RE-characterized from a “scam” to the level of criminal felony theft.

Astounding! One would think it’s NOT a coincident that the scammers would accidentally stumbled on the fact there was a $528,000 potential target available in the Galveston County accounts payable system. But from all the reporting so far it appears the Galveston County administration has concluded there was no culprit that alerted the scammer to such an attractive potential.

There is so much lacking in this report it does little to arrest the suspicions of the public. The lack of decisiveness and the ambiguity in the information at this point definitely does nothing to improve the credibility of the administration. Nor does the additional $15,000 forensic investigation produce anything one would consider worthwhile.

It is unbelievable that a transaction of this size can travel through all the departments policies and procedures and a computer designed system without triggering it is an exceptional item requiring executive review and approval before issuing ½ million dollars of payment. Since this was the case ($528,000.00 was not an exceptional item) the only reasonable conclusion is serious deficiency exist and have existed for many years. These are the kind of deficiencies that would be expected to be highlighted every year in the auditor’s report. Presumably the county does have a yearly auditor report.

Ray Taft

It’s not a leadership problem. It’s a government-employee problem brought to us by a politicized media.

County employees are not serving the public with their cavalier attitude about doing their jobs. Apparently, doing the minimum to get through the day is the norm for county workers. They are definitely not acquainted with going the extra mile.

Government workers in America are aided by the politicized fake news media. The media is constantly slamming elected Republicans and blaming them for absolutely everything. So government workers everywhere probably feel they only have to wait out the latest Republicans’ term. It would make their day if Democrats get elected because the media ignores anything illegal, immoral or wrong a Democrat does.

Paul Hyatt

In the real world people would have been fired for this type of screw up, but in the government world people are not held responsible nor accountable. It must be nice to have a job that you can lose a half a million dollars and no one can have the finger pointed at them. It is really incredulous that people who work in finance do not know how to pick up a phone and call someone that has just changed their banking info to see if they really did change everything. But no they use email which has been able to be scammed for a long time and never once thought to use the phone and they still have a job! If I was the bond companies I would refuse to pay out for this type of stupidity....

Miceal O'Laochdha

"It does so in a sentence that stands as a monument to the grammatical passive voice’s ability to shield actors from their actions." Passive voice is indeed a perfect characterization of these findings! When my son was 10 years old, he too understood this principal when he reported to me that a valuable lamp in our living room had: "fallen on the floor". Clearly that 10 year old would have made an exemplary Galveston County employee or official. However, he grew up to be a responsible and forthright young man and so is no longer suitable for local government employment. I hope the child work laws will not interfere with the County getting the best employees possible to serve us. Many 10 year old's are available.

Rusty Schroeder

You are right Michael, this is a failure from the top to the bottom. First it happened, then a report was given by each department with none taking blame, then an outside firm was hired to find the fault. Well, we see how that report has now unfolded. There was a person that changed the process for the payment, that person has a supervisor, and that person has a supervisor that is probably the head of the department. So I cannot accept that no one is accountable, like I have said before, this would have a different outcome at any financial institution. Just not Galveston County, which in my opinion is a financial institution of the county taxpaying public. rs

Victor Krc

Having been involved in Treasury operations in the private sector in my prior life I can see this screw-up has a simple explanation that absolutely did not require an expensive "study". Apparently someone in either the county treasury department or accounts payable received a request from a recognized vendor to change their method of payment from check to wire transfer. The request would have been in the form of wiring instructions that indicated the receiving bank's routing number and the recipient's account number. The County employees did not have to "create" the account, that would have been done by the scammers beforehand. On the surface that request is reasonable enough as wire transfers are cheaper and easier to process at both ends of the transaction and the recipient receives immediate availability of the money. There should have been procedures in place to verify the legitimacy of the request and someone at the appropriate level of authority should have signed-off for such a large wire transfer. Who was that person? Once a wire transfer has gone out it is in effect gone and you can bet in this case the funds were immediately transferred out of the receiving bank to somewhere else. How long did it take before the theft was known is another question that needs to be asked. Simple enough.

Rusty Schroeder

As far as how long it took for the theft to be known, long enough for the check to clear and the account closed. The vendor called Commissioner Apffel wondering why payment was taking so long. That's when questions started being asked and body parts started tightening in the Purchasing and Treasurers Departments.

Dalton Logan

For a transfer of exactly, $525,282.39 to have been done, then I would think that either someone in the county's accounts payable or someone associated with the contractor, past or present, would have had to have prior knowledge of the amount. I can't envision some off the street scammer being able to pull this exact amount out of some body orifice.

Carol Dean

In Corporate America and the US Military, the "buck stops at the top". We all know who that is here in Galveston County.

In a recent FaceBook posting, Mark Henry alludes to the fact that the

Carol Dean

Current Head Purchasing Agent was appointed by Judge Lonnie Cox as if to deffer some of the blame. Mark then claims that he voted "NO" on this issue in August. The truth of the matter is that Mark Henry was NOT even there when the vote was taken. He was a "No Show". There is no way to send in a proxy vote. He is simply trying to put blame on someone else. In fact, it was Judge Ellisor who was in charge when the vote was taken, not Judge Cox. The vote was a unanimous vote of four by the District Judges.

Of course, Mark Henry is not pleased with the results of the study. Next time, maybe he might want to be more specific about what kind of results he wants before signing a contract?

"Show Me The Money"!

Carol Dean

Strange that I am only hearing crickets in regards to Mark Henry's failure to tell us the truth about his inactiveness. He has very clearly stated that his was a "No" vote and the truth is that he was NOT EVEN there when the vote took place. Wrong answer, Mark.

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