A few week's back we noted the shady manner in which Rutgers Coach Greg Schiano was wetting his beak. Apparently that's just scratching the surface. The State University's Athletic Department, according to an internal audit (and not surprisingly), may be as crooked as the state's elected officials.
The Star-Ledger via NJ.com reports: "Months before revelations of hidden deals and no-bid contracts sparked two investigations, Rutgers University auditors were warning that no one was watching the money flooding into the school's athletic department. A confidential internal audit issued nearly six months ago criticized the department's fiscal controls -- including hundreds of thousands of dollars in off-the-books spending that never appeared in the Rutgers budget."
Apparently, it's just the burden of "success."
Said Joseph Sikora, the university's director of internal audit, "The leadership and organizational structure over athletics' financial operations show signs of being overextended at a time when the football program is undergoing rapid growth and success."
The 23-page report describes a department suddenly flush with additional sponsorship money and soaring revenues, following the rebound of the once hapless Scarlet Knights football team. At the same time, it details how the department eagerly tapped into those resources with seemingly little oversight.Zoffinger: "They're basically diverting funds that were sold as sponsorships to pay for other things that are not on the books of the university. This is not the right way to spend public money. The money should come to the university and then be allocated from there. It's inappropriate."
Auditors found the athletic department subsidized the travel costs of boosters and other VIPs who accompanied the Scarlet Knights on charter flights to post-season bowl games the past three years, at a time when the university was hiking tuition and cutting academic budgets. It also discovered that the department understated its expenses for those games in reports to the administration and concluded the athletic department lacked the ability to collect and reliably report critical financial information "to the president, CFO, the board and the public.
The audit also focused on the university's partnership with a sports marketing company that had exclusive rights to handle radio and television advertising and promotions, funneling millions of dollars into the athletics department.
George Zoffinger, chairman of the audit committee on Rutgers governing board, said the athletics department structured sponsorship deals in a way that deliberately kept the money out of university coffers, and away from direct oversight of administration finance officials.