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Audit scolds Municipal Employees Retirement System former director

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BATON ROUGE - An audit released today scolded the Municipal Employees' Retirement System (MERS) over allegations money as misspent.

The former director, Bob Rust, quit when this came to light last year. MERS is a system that invests money for nearly 11,000 employees from cities and towns across the state.

The problems cropped up from using taxpayer money for luxuries. Alcohol was purchased for conferences and expenses without receipts are just a few of the items auditors say were big problems.

MERS is a retirement system that for cities and towns that opt in. The audit revealed Former Director Bob Rust spent money that was paid into the retirement system for things he shouldn't have. State Treasurer John Kennedy sits on the board and was not happy with the findings.

"I asked the board to file suit against the former executive director to recoup any money he owes," Kennedy said.

The audit released today revealed alcohol was purchased at a 2014 conference. Detailed receipts for meals were also not kept.

"All of the controls are much tighter now than they were beforehand," Acting MERS Director Warren Ponder said.

Ponder said there are more stringent protocols in place to prevent this from happening again in the future.

"We looked at all of our policies and revised all of our policies for the system," Ponder said "We have a no alcohol provision now. The CPA for the system has to review each and every receipt."

Auditors found the system's former director planned and attended conferences out of state totaling $317,000 over a span of four years. Those paying into the Retirement System were not only paying for the director's cell phone, but also one of his sons.

"The MERS credit card is kept here in the safe, and no one has it to use on a regular basis," Ponder said.

Although the audit was embarrassing to MERS, Kennedy believes those paying into the system deserve better.

"They were spending retirement money at an out of state resort, going to expensive meals and drinking expensive liquor," Kennedy said. "You shouldn't need someone to tell you there's something wrong with that."

MERS says the money paid for the cell phone of the former director's son has been recouped. On one occasion, a trip that was canceled cost $42,000 in cancellation fees.


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