By Daniel Libit
The Office of the New Mexico State Auditor has formally notified the University of New Mexico of its intent to take a long, hard look into the finances of Lobo sports, according to a document obtained by NMFishbowl.com.
On Wednesday, State Auditor Tim Keller sent a letter to UNM Interim President Chaouki Abdallah, informing him that OSA had designated UNM and its component units for ‘Special Audit’. Keller wrote this determination came after his office had received “information raising concerns related to athletic fundraising activities and expenses.”
The special audit, which will be handled in-house by the State Auditor’s staff, is a significant and rare step that speaks to the gravity of the concerns raised about the use of funds for UNM Athletics. Typically, the State Auditor, which oversees 1,500 public entities across New Mexico, will conduct only a handful of special audits each year.
“We feel it is important to do a deep dive and get to the bottom of questions that have been raised regarding expenses, compensation and perks for senior staff in the athletics department and donors,” Keller told NMFishbowl.com in a statement Thursday.
“In light of the conflicting responses we’ve seen to the allegations, the public deserves some sunshine on what’s going on at our state’s flagship sports program.”
The letter to UNM indicates that the State Auditor plans to cast the widest possible net as part of its investigation, looking at the flow of athletic-related monies at the university, the UNM Foundation and the UNM Lobo Club. Because the latter two entities are components of UNM, the OSA says it has the statutory authority to subpoena their documents. Keller told Abdallah that he likewise expects to have “unrestricted access to all documents pertaining to the issue as well as access to UNM staff that may have knowledge and information about the areas of concern.”
The special audit designation represents the most intense form of governmental scrutiny that has been placed on UNM’s Athletics Department in recent memory. The move comes on the heels of an unfolding scandal involving a 2015 golf trip to Scotland, hosted by UNM’s Athletics Director Paul Krebs. Both the OSA and the state’s Attorney General have recently announced that they would open investigations into how school resources were to used pay for Lobo boosters, UNM officials, and their families to travel as part of that trip.
In September, Keller’s office sent a referral letter to KPMG, the outside firm that handles UNM’s annual audits, alerting it to allegations of purchasing card misuse involving former UNM basketball operations director Cody Hopkins. The letter also asked KPMG to place heightened scrutiny on the ongoing payroll statuses of Hopkins and former assistant Athletic Director Tim Cass, who left in December 2015 to take a job with the United States Tennis Association.
Earlier this year, Hopkins told NMFishbowl.com that there were wide-reaching issues involving financial mismanagement throughout UNM’s Athletic Department. Hopkins also described an all-consuming fear among department leadership over the prospect of outside investigators looking into the books.
“I was told many times that we just don’t want an audit,” Hopkins said.
Following the publication of this story, Keller’s office tweeted out the following message:
Additional concerns, whistle-blowing lead to broader scope 4 Special Audit on Lobo athletics. Call 1-866-OSA-FRAUD if you have specific info https://t.co/kHoEuRLwT1
— Auditor Tim Keller (@nmauditor) June 1, 2017
(Lead photo by Sara MacNeil/NMFishbowl.com)