Broward auditors looked, but found nothing wrong before the Port Everglades P-Card scandal broke

cruise ships docked in blue water at port
Cruise ships docked at Port Everglades

By Dan Christensen,

Two years before the Port Everglades P-Card spending scandal blew up, the Broward County Auditor’s Office issued a reassuring report saying that it had reviewed P-Card transactions at the port and found nothing amiss.

“We conclude that Port has properly used and accounted for procurement cards in accordance with the policies and procedures established for the County’s procurement card program,” says the auditor’s Sept. 27, 2017 report. “We noted no opportunities for improvement.”


Nine months later, the Broward Sheriff’s Office, and later the FBI, sent agents to the port to investigate allegations of out-of-control spending by numerous port employees. So did the auditor’s office. The first guilty pleas in the case came last week, and more pleas and arrests are expected as the probe continues.

P-Cards are county-issued credit cards provided to many county employees so they can purchase up to $3,500 per single transaction to meet county business needs. Purchasing limits are $6,000 per day and $20,000 per month. Employees who get a card must complete an online tutorial and sign an agreement to abide by all P-Card policies and procedures.

The auditor’s report looked at whether P-Cards had been used and accounted for properly. To find out, auditors interviewed staff at the port and the county Purchasing, Accounting and Enterprise Resource Planning divisions. The review period was from Oct. 1, 2016 through Dec. 31, 2016.

“Our review included such tests of records and other review procedures as we considered necessary in the circumstances,” the report says.

During that three-month period, auditors determined that 81 port P-Cards were used in about 1,400 transactions to spend approximately $832,000.  That’s about 15 percent of the total of $5.7 million spent during the same period by all employees using 950 P-Cards, the report says.

In January, Florida Bulldog first disclosed the existence of the investigation and reported that a county source familiar with it said authorities had identified a decade’s worth of suspicious purchases by just one port worker totaling $1.1 million.

Missed P-Card scandal

According to County Auditor Bob Melton, the review at the port was part of a broader inquiry into P-Card spending that included looks at other county departments, including aviation. He called it a “high-level controls review” that looked at the processes in place to determine whether P-Card control policies were being met. That included examining invoices to see if they were properly approved.

The auditor’s report that followed, including its conclusion that no fixes were needed, gave readers – most notably the county commission – the false impression that P-Card spending by port employees was under control and that county policies were working well.

Asked about that by Florida Bulldog, Melton said that a high-level controls review is not a fraud audit and was not designed to detect collusion between employees and vendors, such as was found to have happened in the criminal probe. “We were looking at the surface to see if the i’s were dotted and the t’s were crossed,” Melton said.

While Melton signed the report, he said the work was done before he started in June 2017. “We have changed that approach since I came. If you look at all the reports before, they were called reviews. Nothing was called an audit. We don’t do those high-level reviews. We do audits,” he said.

Melton explained that “a full audit entails doing comprehensive risk analysis of all the things that could go wrong in a department’s operation and detailed tests of transactions and procedures and so forth to determine if anything has gone wrong in addition to internal controls.”

Would such an audit have picked up in advance on the P-Card scandal at the port?

“I would like to think a full audit would have picked up on this, yes,” Melton said. “Even in many cases where in fact the i’s were dotted and the t’s were crossed, a lot of stuff was going on. That would have been detected.”

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Latest comment

  • Auditors are worthless. How can the possibly miss so much. This is not the only mishap that is missed. The criteria for auditing must be very very high level and subjective. Internal auditors cannot be objective. Shame on you!

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