UB attempts to tighten financial controls
A timeline of UB's financial measures amid Dennis Black and Andrea Costantino's investigations
Erie County’s District Attorney John Flynn had questions for UB after two former university administrators pleaded guilty in court to stealing hundreds of thousands of dollars in state funds last Thursday.
“What can be done to prevent this further?” Flynn asked. “What mechanisms need to be put in place at UB to ensure that this doesn't happen again? That's the key question right now. And that's not a job for me. That's out of my lane. That's the question that the Council at UB, in my opinion, needs to address."
The convictions of former UB Vice President Dennis Black and former Campus Living Director Andrea Costantino came roughly six months after a former UB maintenance supervisor pleaded guilty to felony charges of big-rigging.
The Spectrum asked UB administrators what is being done to ensure these thefts do not happen again. The following timeline reflects a series of measures the administration says it has taken as the Black scandal unfolded.
UB names Director of Internal Audit
On April 7, 2016, UB names a Director of Internal Audit, Kara Kearney-Saylor. Kearney-Saylor is the first to hold this title at UB. Spokesperson John Della Contrada explained that while there has always been an internal audit function, there was never a director overseeing the process.
Since coming aboard June 1, 2016, Kearney-Saylor has been tasked with a major role in developing and managing the school’s internal audit policy. These tasks include developing and managing a comprehensive risk assessment and internal audit program, leading the development of UB’s annual audit program and serve as the first point of contact for all external audits.
UB revises fraud and irregularities, awareness and reporting policy
UB updates its fraud and irregularities policy by eliminating the SUNY ethics hotline in favor for a new, third-party-affiliate UB EthicsPoint hotline. Kearney-Saylor receives and reports hotline results to UB’s leadership who then investigate the matter.
Kearney-Saylor said the hotline has been used since its rollout in fall of 2016, but the results of the investigations are kept confidential.
UB announces VP Dennis Black’s resignation
President Satish Tripathi announces Dennis Black’s resignation. Laura Hubbard, vice president for finance and administration, takes over as interim vice president. Tripathi thanks Black for his almost 40 years of service and wishes him good luck in retirement. The university makes no further comment as to the nature of Black’s abrupt and unceremonious departure.
UB launches EthicsPoint hotline
UB launches its partnership with third party hotline, EthicsPoint. The EthicsPoint hotline will serve as another platform for students and faculty to report any issues or irregularities in conduct on campus. Kearney-Saylor oversees the hotline and reports issues to leadership at UB. Faculty express mixed feelings toward new hotline.
UB creates new safeguarding cash and cash equivalents policy
UB establishes policy for all departments who handle cash and/or cash equivalents. The policy discourages use of cash or checks in favor of electronic forms of payment (ePay), establishes policy on handling cash or checks securely when it is necessary, and establishes checks and balances through “segregate duties” when employees are handling cash.
UB revises external audit activity policy
External audits will now be directed to the Director of Internal Audit, Kearney-Saylor instead of the Associate Vice President and Controller. The audit engagement partner must be rotated every five years and the audit engagement firm rotated every ten years.
UB creates new internal controls policy
UB establishes an official framework for best financial practices. The policy outlines best practices, including segregation of duties, safeguarding assets, review and approval and documentation, as well as outlining responsibilites for the president, internal control officer, internal audit and all other employees.
UB creates risk management panel
UB creates a risk management panel with The Enterprise Risk Management (ERM) steering committee is scheduled to have its first meeting October 13. The panel includes more than 16 members, leaders from across the university will bring attention to potential risks across the school and decide how to deal with them.
“This could be anything from potential safety hazards to something that would bring the school negative attention,” said Della Contrada. “Businesses have done this for a number of years and it’s something that’s taken hold.”
The ERM’s executive sponsors met to discuss their approach back in April. Its first meeting is scheduled for October 13.