City review finds almost $5.8 million in duplicate payments
A review of Richmond’s financial data identified almost $5.8 million in duplicate payments, including a $5 million wire transfer that was processed twice.
Most of the errors had already been spotted and fixed before the review by the office of City Auditor Riad Ali. However, a little more than $151,000 had not been previously identified, meaning the city will have to take further action to recover the erroneous payments.
Paying a bill twice is an “inherent risk” in an organization the size of Richmond’s government, Ali said in a May 11 report, but even a small amount of errors “could result in significant financial loss.”
“Duplicate payments result in inefficient use of public resources, increased administrative costs to research and recover funds, and may indicate weaknesses in internal controls within the procure-to-pay process,” the auditor’s report said. “They may also negatively affect the reputation of local governments.”
The auditor’s office looked at financial records for fiscal years 2024 and 2025 to conduct its review, zeroing in on 5,249 invoices that had slightly different details but showed signs of being duplicates such as identical amounts, dates or invoice numbers. After investigating further, 50 invoices were confirmed to be duplicates, but the auditor’s office warned there could be more that fell outside the scope of the criteria used.
According to the review, duplicate payments can occur because of the same invoice being submitted twice, minor differences in invoice numbers, multiple records in city databases for the same vendor and payments being sent to the wrong vendor then paid again to the correct vendor.
Roughly a quarter of the duplicate payments lacked purchase orders, which the auditor’s office highlighted as an “important control” for preventing double payments.
The auditor’s office also said it found a “system limitation that created a risk that duplicate or erroneous payments could be reissued even after being voided. The review found three examples where the city was able to void a payment that hadn’t cleared the bank, then “automatically” reissued the money because city systems didn’t allow invoices to be voided if the linked purchase orders had been finalized.
The auditor’s office recommended that city departments “take appropriate and timely action” to recover the money that shouldn’t have been paid. Mayor Danny Avula’s administration concurred with that suggestion.
“Departments with outstanding balances will be expected to pursue all appropriate remedies, including direct refund requests and escalation to Procurement or Legal as necessary,” the administration wrote in its response.
To conduct the review, the auditor’s office relied on a version of the city’s payment register, which is a log of all payments to outside vendors.
Since 2015, officials have been legally required to publish data from the payment register on the city’s website. However, the city is refusing to do so, saying compliance with the 2015 law creates an undue risk of releasing sensitive information protected under various privacy laws.
Avula has proposed significantly scaling back the extent of the financial data the city would publish under the law, with the goal of reducing the staff time necessary to review the data and redact sensitive info.
Councilor Kenya Gibson (3rd District), who has pressed the administration to resume compliance with the financial transparency rule, has a competing proposal to initiate a Council investigation into the failure to publish the payment register.
Both proposals are set to be taken up at the Council’s Finance and Economic Development Committee meeting scheduled for Wednesday at 2 p.m.
Contact Reporter Graham Moomaw at gmoomaw@richmonder.org
