South Carolina Treasurer Curtis Loftis faced scrutiny on Wednesday over an accounting error that led to a $1.8 billion fund discrepancy, with calls for his resignation labeled as a witch hunt. The issue, known to Loftis' office and two others for six years, involved misallocations rather than actual cash. A private forensic audit was required to rectify the situation, costing millions.
Loftis attributed the blame to retired staff members and other state agencies involved in financial oversight. However, lawmakers, particularly in the Senate, expressed doubts. Senator Larry Grooms called for Loftis' resignation, and the Senate Finance Committee passed a resolution to have a private accounting firm oversee the Treasurer's Office until confidence in the state's financial accounts is restored.
The accounting error stemmed from a system change in the 2010s, resulting in a $1 billion discrepancy. The problem came to light after resignations by Comptroller General Richard Eckstrom and State Auditor George Kennedy, who failed to report the $1.8 billion discrepancy.
During questioning by the House budget subcommittee, Loftis defended his office's actions, stating they were working to address the mistakes made by external parties. He expressed regret over the situation and highlighted efforts to rectify the errors.
Despite Loftis' assertions, concerns remain about the impact on South Carolina's credit rating and borrowing capabilities. The Senate and others have been vocal in holding Loftis accountable for the accounting issues, leading to a tense exchange between Loftis and Senator Grooms following the hearing.
While Loftis maintains that his staff is working to resolve the discrepancies, the fallout from the accounting error continues to draw attention and criticism from lawmakers and the public.
