State Treasurer Curtis Loftis issues detailed report in response to the $1.8B

Columbia, SC – State Treasurer Curtis Loftis released a detailed report on the $1.8 billion conversion entry. The report addresses findings and recommendations from the AlixPartners review and the Senate Finance Constitutional Subcommittee’s interim report issued last April.     

“To be clear, there is no mystery bank account with $1.8 Billion in it. There is no missing or misspent money, and all cash and investments have been properly managed and accounted for by the State Treasurer’s Office. The AlixPartners Report confirms these facts, and the citizens of South Carolina can be assured that their tax dollars are safe and secure,” said Treasurer Loftis.

While lengthy in its breadth and detail, the report shares extensive research to examine the $1.8B conversion entry balance and the AlixPartners’ review of how the conversion entry was made.

• The Comptroller General’s Office advised STO staff that non-cash (appropriations) had been removed from the conversion entry when in fact they were not.
• Treasury staff proceeded with its conversion entry, which unknowingly included $1.6B in non-cash (appropriations) with cash.
• AlixPartners confirmed this was the cause for the inflated “cash” balance in the SCEIS conversion fund.

AlixPartners’ solution is to reverse the entries to eliminate the non-cash elements and correct the conversion account issue. More importantly, the report confirmed these corrective transactions will not have any impact on the State’s cash balance.

“This is good news for our taxpayers. My office has acted in good faith to research and understand the accounting error made during the SCEIS computer conversion,” Loftis added.

The report also addresses the assertions made by the Constitutional Subcommittee, whose members appear to be more focused on creating doubt about the state’s financial system than working to support efforts to strengthen it.

There is evidence that documents provided to the subcommittee were modified to support a narrative that suggests:

• The State Treasurer was solely to blame for the error.
• Treasurer Loftis was hiding or concealing funds.
• He was not fulfilling his statutory duties, including the publishing of a highly sensitive financial report.
• Inaccurate under-oath testimony made that attempts to place undue blame on the Treasurer for the CGO’s errors.

“The State should accept the AlixPartners recommendations and move forward. Our taxpayers deserve better than the subcommittee’s continued grandstanding which places the State’s strong credit ratings and ability to access affordable financing at risk,” Loftis said.

To access the full report, visit the Treasurer’s website – treasurer.sc.gov.