An audit of the Memphis Police Department’s Organized Crime Unit says the unit, which includes undercover drug investigations and other covert operations, “needs significant improvement” in obeying guidelines for the use of money in the OCU drug fund.
The completed internal audit by city’s audit team released Thursday, Jan. 26, also concludes eight OCU employees should not have been allowed to work as training instructors for Investigative Techniques Unlimited because of a conflict of interest.
ITU is a company founded by former OCU officer Paul Sherman, who coordinated OCU’s undercover program. ITU had a contract to provide instructors for classes given by the Regional Counterdrug Training Academy, which is where OCU officers receive specialized training. RCTA paid ITU for the instructors who taught officers from police agencies including by not limited to the MPD.
Sherman also recommended which Memphis police officers received the RCTA training while he was still with the department, according to the report.
The report specifically concludes $183,555 in overtime paid to OCU officers from the drug fund as they worked as instructors at a training facility was not a “drug enforcement expense.”
It is the largest single amount of a total $245,710 questioned in the audit findings.
City Chief Ethics Officer Monika L. Johnson concluded in an October letter that the OCU officers working for ITU should give up the side jobs as instructors or not teach ITU courses attended by Memphis cops.
The audit was originally to be a basic look at whether OCU was complying with the state’s guidelines for the use of drug funds. The funds are divided into several areas and provided by several sources including state and federal funding. Some of the money is used covertly and is in bank accounts that can’t be traced back to the city of Memphis. Other funds are in conventional city accounts that are supposed to use conventional accounting procedures and practices.
The review was requested by Memphis City Council member Janis Fullilove at the end of the tenure of police director Larry Godwin.
During Godwin’s tenure as police director, the department through OCU resumed the practice of some officers working “deep undercover” in which they live under assumed identities for two years at a time.
The deep undercover work comes with more covert spending of drug funds to maintain an officer’s cover for a longer period of time.
As the audit team was planning its work, they found other information that they say caused them to expand the scope of the audit to include potential conflicts of interest and training expenses.
Another $41,550 from the drug fund spent on recurring general training courses was also not a permissible use of drug funds, according to the auditors.
Most of $8,516 paid as confidential cash expenses should have instead been handled as non-confidential expenses, and auditors could not find case notes to back any of the amounts paid for specific case work even though case numbers were included to account for the money.
Among the items paid for with confidential funds was a $216.54 Memphis Light, Gas and Water Division bill on an address owned by an OCU officer. In that case, the auditors could find an address for the bill. But the report concludes the auditors have concerns about “the validity of other utility bills that auditors could not trace.”
The audit labels another $12,089 in transaction receipts “suspicious” because the expenses should have been paid with cash but were instead paid with non-OCU credit cards.
The report clears $119,970 in drug fund money used to reimburse the expenses of a civilian based on what the unidentified person told them and provided in the way of paperwork. The auditors weren’t able to interview the unit’s covert activity coordinator or see documents the coordinator should have maintained.
The audit specifically faults Godwin for appearing to directly or indirectly influence the work duties and career of his son, Anthony Godwin, who was an undercover officer in the unit. The two specific instances are approving a special request for uniforms and Godwin sending his son to represent the department at a training certification activity.
The audit team, in a letter to MPD Director Toney Armstrong, also noted that some of the officers they sought to question about drug fund expenditures didn’t cooperate. They wouldn’t agree to be interviewed by auditors or complete a conflict of interest survey form.
“The key individual responsible for accountability and control for covert activities did not assist with the audit,” project manager Debbie Banks wrote in the letter to Armstrong, saying the lack of assistance was a “significant audit limitation.”
In his written response to the report, Armstrong accepted all of the findings and vowed to take specific steps to meet accounting rules and regulations for the use of the money. He also agreed his division would repay the drug fund more than $260,000 for items questioned in the audit.