Auditors at San Diego’s transportation and planning agency are accusing management of improperly making severance and sick time payments to employees, and failing to report the expenditures to the agency’s board of directors. The San Diego Association of Governments (SANDAG) Executive Director Hassan Ikhrata supervises an annual budget of nearly $1.3 billion, and has allegedly approved hundreds of thousands of dollars in compensation packages to individual former employees.
SANDAG’s recently created Office of Independent Performance Auditor (OIPA) issued a report alleging improper spending by Ikhrata since he took the Executive Director position in December 2018. The auditors claim Ikhrata circumvented existing regulations to establish his own policy objectives.
“The material findings disclosed within the report were a result of significant weaknesses in SANDAG’s governance and system of internal controls,” independent performance auditor Mary Khoshmashrab wrote to board chairman and Poway Mayor Steve Vaus, the San Diego Union-Tribune reports.
The payments in question include a $110,000 sick time payout redemption, a $60,000 severance to a senior official who voluntarily resigned, and $112,000 in bonuses and merit increases to a former chief deputy without board approval. OIPA also found that executive compensation costs increased by up to $2 million per year. The auditors describe the agency’s executive salaries as “top heavy” for an organization its size.
SANDAG has not implemented controls to ensure adherence to regulations that govern public agencies, the auditor says. The report includes a 38-page management response that rejects the auditor’s findings. 
Elizabeth Mullen is an editorial consultant for Internal Audit 360°.