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South Carolina comptroller resigns over $3.5B accounting error

Legislators were considering impeachment for South Carolina’s top accountant after a $3.5 billion error caused a misreporting of the state's cash balances.

CHARLESTON, S.C. (CN) — The embattled state comptroller for South Carolina announced Thursday he will resign after acknowledging his office misreported a $3.5 billion surplus in the state’s cash balances.

Comptroller General Richard Eckstrom's wrote in a letter to Governor Henry McMaster that his resignation would be effective April 30.

"Over the course of my time in public office, I have taken great pride in the responsibility entrusted to me," the comptroller general wrote. "I have been humble in my approach to the job, an attribute I hope our constituents have recognized and will remember."

Eckstrom's announcement came as a House subcommittee was weighing impeachment proceedings against the state's top accountant for dereliction of duty and breach of public trust. Eckstrom was expected to testify at an April 4 hearing.

On Tuesday, a Senate subcommittee unanimously advanced a constitutional amendment that would allow the governor to nominate the next comptroller general for Senate approval.

Eckstrom wrote that he had been a "longtime advocate" for the amendment.

He has served as the state’s top accountant for 20 years and ran unopposed in November. His political career had been in jeopardy since admitting last month that a $12 million coding error in the state's accounting system had compounded into a $3.5 billion exaggeration of the state’s cash position.

A recent hire from the state treasurer’s office discovered the error last year. She determined the comptroller was double counting the amount of cash transferred to colleges and universities. The mistake did not impact the state’s actual available cash or budget, but it could cause concern among bond rating agencies that use the comptroller's annual financial reports to evaluate the state’s fiscal health.

Eckstrom told a Senate finance subcommittee last month he knew there was a problem in the “early summer” of 2022, but he did not know the extent of it until “very late” into the year.

Senator Thomas McElveen, a Sumter Democrat, questioned why Eckstrom did not alert taxpayers and voters about the problem before the November election.

Eckstrom said he did not believe the error would impact the state’s credit score, but McElveen worried the issue would loom over the state’s financial reputation.

The subcommittee issued a report last week recommending the comptroller be impeached and his office abolished. Members described Eckstrom’s testimony as “confusing” and “cavalier” and found he lacked confidence or certainty in his answers, the report states.

Eckstrom earns a $151,000 salary as comptroller, but an amendment passed last week by the House would have reduced his salary to $1 for the remainder of his time in office.

Categories: Financial Government Politics Regional

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