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Tampa Bay job center employees received money they didn't earn, auditor finds

 
Edward Peachey, the fired former president and CEO of CareerSource Tampa Bay and CareerSource Pinellas, listens to board members discuss whether to pay him a settlement earlier this year. [DOUGLAS R. CLIFFORD | Times]
Edward Peachey, the fired former president and CEO of CareerSource Tampa Bay and CareerSource Pinellas, listens to board members discuss whether to pay him a settlement earlier this year. [DOUGLAS R. CLIFFORD | Times]
Published July 6, 2018

Leaders at two publicly-funded career agencies in Tampa Bay approved inflated monthly bonuses for staffers who didn't meet job performance thresholds, an auditor has found.

The Tampa Bay Times reported two months ago that the agencies' incentive program paid $1.9 million since 2014 to several dozen staffers. A key metric was the number of people staffers placed into jobs. The agencies touted the placements to local and state officials, and staffers earned more money by logging additional hirings.

But Powell & Jones, a Lake City accounting firm, found that employees earned money even when they failed to reach the minimum requirement for incentives.

READ THE ORIGINAL STORY: Payroll records show $3.1 million in bonuses, incentives at CareerSource centers

The auditors looked at a sample of 25 staffers over a period of about a year for CareerSource Pinellas. They found 48 cases, or 65 percent of their sample, had boosted payments. The firm didn't examine payments at CareerSource Tampa Bay, which had the same incentive program.

The boosted payments are the latest revelation about CareerSource Pinellas and CareerSource Tampa Bay, which are under federal and state investigation over how they reported job placements and spent millions of public dollars to help people find work.

Auditor Richard Powell told CareerSource Pinellas board members last week that the firm could not find documentation to support payments when staffers didn't meet the threshold for money. The findings didn't list individual staffers who received the money or provide examples.

Business Services Director Haley Loeun signed off on some of the figures and president and CEO Edward Peachey approved some, according to records CareerSource Pinellas provided this week to the Times.

When reporters knocked on Peachey's front door Friday to request comment, Loeun answered and declined to talk after the Times explained the auditor's findings. Peachey did not return a phone call for comment.

Peachey and Loeun were both fired earlier this year. Current and former employees had said they were in a romantic relationship, and three of Loeun's relatives had been hired at the job placement centers in recent years. Both Peachey and Loeun denied the relationship.

BACKSTORY: Amid CareerSource controversy, allegations of a love affair, big raises and family favoritism at the top

Loeun's brother-in-law, who was also fired this year, worked as one of the employees involved in placements and earned incentives.

Peachey and other agency leaders for months denied that anyone benefited from higher placement numbers. But the incentive program clearly provided financial rewards for people who racked up more placements. No other job placement agencies in Florida had similar incentive programs.

In 2017-18, for instance, staffers could earn $1,400 a month for meeting certain benchmarks, which included placements. The program promised a chance at $16,800 a year, records show, when recruiters had a starting salary of $35,000.

The Pinellas agency shared leadership — including Peachey and Loeun — with CareerSource Tampa Bay in Hillsborough County, and the incentive program dated back several years.

INVESTIGATION: CareerSource centers took credit for thousands of hires they had nothing to do with

The centers are in the process of separating after years of working as sister agencies; CareerSource Pinellas handles the payroll on both sides of the bay.

CareerSource Tampa Bay has vowed to perform its own deeper audit to examine all the incentive payments it doled out, interim director Juditte Dorcy said in a statement.

"We have been and continue to examine our internal processes, policies and procedures for business services, as well as all other programs, to ensure the most effective use of taxpayers' dollars," Dorcy said in a statement. "As a result, we have been making changes — with (the state's) guidance — surrounding any areas of concern and we will continue to do so."

During last week's CareerSource Pinellas board meeting, members asked few questions about the payments. None called for a deeper investigation at that time.

On Thursday, Jennifer Brackney, interim director of CareerSource Pinellas, said she will ask board members later this month what they want to do next.

"CareerSource Pinellas is committed to moving forward with accountability, integrity and transparency," Brackney said in a statement, later adding that the report will be "reviewed in more detail" by an audit committee and "the board will determine next steps."

When leaders adjust incentive payments now, she said, they provide justification in records.

The incentive program is already tied to the controversies at the job centers. The Times reported in February that the agencies, previously heralded as stars in Florida's network of 24 CareerSource offices, for years took credit for finding work for people who never sought their help. The state's two U.S. senators, as well as a number of local politicians, called for inquiries from the U.S. Department of Labor and Florida Department of Economic Opportunity.

The DEO has requested a copy of the auditor's latest report, said spokeswoman Tiffany Vause.

"After reviewing these materials, we will take any necessary action," she said in a statement.

THE LATEST: Tampa Bay CareerSource centers say they've stopped trading gift cards for hiring information

FROM THE ARCHIVE: Tampa Bay job centers gave away millions in gift cards and boosted hiring totals

CareerSource Pinellas board member Bill Law said he wants further information on the incentive program to determine if it makes sense.

"I suspect we're going to be working through a great deal of prior practice that nobody wants to support," said Law, the former president of St. Petersburg College, who recently returned to the board after serving years ago.

Hillsborough County Commissioner Sandy Murman, a longtime member of the CareerSource Tampa Bay board, said Thursday she had not yet seen a copy of the auditors' report.

"I'm sorry this stuff just keeps coming up. It's frustrating, but we're going to get it right," she said. "We are scrutinizing every single thing."

Contact Mark Puente at mpuente@tampabay.com or (727) 892-2996. Follow @MarkPuente. Contact Zachary T. Sampson at zsampson@tampabay.com or (727) 893-8804. Follow @ZackSampson.