Bid Opens to Fire South Carolina Comptroller for $3.5 Billion Accounting Error

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COLOMBIA, South Carolina — South Carolina lawmakers angered by a $3.5 billion accounting error by the state comptroller general began efforts Thursday to fire the official, a day after demanding he resign or be fired.

Comptroller General Richard Eckstrom told senators last month that he had inadvertently overstated the state’s cash position by $3.5 billion by overstating the amount the state had sent to colleges and universities over a decade. He has signaled that he will not resign.

The error was not in the actual cash, but in the way the state reports its balance sheets. It could hurt South Carolina’s credit rating and has eroded the trust that a large number of lawmakers in the Republican-dominated state had in Eckstrom.

A resolution filed Thursday seeks a two-thirds vote of the House and Senate to activate a state constitutional provision that says the governor must remove Eckstrom for “willful neglect of duty.”

The constitution allows Eckstrom a hearing in his own defense, though the exact procedure is unclear. Several senators could not recall this process having been used since it was added to the constitution more than 50 years ago.

A certified public accountant, Eckstrom, 74, spent 20 years as comptroller general and before that four years as state treasurer.

“For at least a decade we know that he has signed his name, Richard Eckstrom, CPA, on our state’s financial closing document and every year he has been wrong,” said Republican Sen. Larry Grooms, who is sponsoring the resolution.

Grooms said the legislature must act because Eckstrom is not doing the “honorable thing” and resigning.

Thirty-eight of the 46 senators signed to sponsor the bill. It only takes 30 to pass the two-thirds threshold. In the House, the resolution needs 83 of 124 votes.

Grooms said he hopes that once Eckstrom is dealt with, the Senate will take up other issues that his subcommittee recommended, such as dismantling his agency and sending his duties to other offices.

The error started as a $12 million coding error in 2007 and escalated when the state changed accounting systems in 2011, Eckstrom told senators at hearings in recent weeks.

State cash transferred to colleges and universities was double-counted, and auditors said Eckstrom ignored repeated warnings about the problem. They said he waited five years for a full account review that finally helped uncover the problem about a year ago.

Eckstrom responded to the Senate report with a statement Wednesday saying he will not resign. He said his office worked tirelessly to find and then fix the problem that began to surface in 2013. The problem was not reported to lawmakers or others in government until months ago.

Eckstrom said he would support a constitutional amendment that would make his job governor-appointed rather than elected, but in the meantime, “no one will distract me from the job ahead of us, the job the voters chose me to do during this term.” .

Eckstrom has run unopposed in the past two elections, and the last time he had a challenger was in the 2010 Republican primary.

Republican Gov. Henry McMaster said last week that voters should hold Eckstrom accountable and not impeach him.

The resolution calls for a lower level of wrongdoing than willful dereliction of duty, where the prosecution requires “felonies or gross misconduct” under the constitution.

McMaster’s office said Thursday that events this week had not changed his mind.

It is not known exactly what happens next. The constitution allows Eckstrom a hearing if he so desires.

“We’re consulting … right now to make sure we’re doing the right procedures,” Grooms said. “He will have the opportunity to rebut.”

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