By Mark Scheer
An audit completed by State Comptroller Thomas DiNapoli investigating the estate work performed by former Treasurer David Broderick has determined that Broderick did not establish “proper procedures or controls to adequately safeguard estate assets or to protect the interests of the estates’ creditors and beneficiaries.”
The report, released today at 10 a.m. questions whether Broderick has consistently acted in the best interest of the estates and adequately fulfilled his responsibilities. Further, DiNapoli’s office noted a copy of the report is being sent to the Niagara County District Attorney for his consideration.
The 71-year-old Broderick served as the county’s chief fiscal officer for nearly four decades. He stepped down from the treasurer’s post in January, citing a need to “deal with various medical issues” and a desire to spend more time with his family.
When he tendered his resignation, Broderick insisted his decision had nothing to do with the state audit or questions surrounding his performance as public administrator of estates in Niagara County. Public administrators oversee estates of individuals who die without leaving wills or have heirs who are unable to agree on the disposition of their loved one’s assets. Under state law, the county’s top fiscal officer is responsible for such work.
Concerns about Broderick’s handling of those duties were raised by Amherst attorney Teresa Snyder, who charged in court that the county’s former treasurer violated state law by allowing his wife, local realtor Jane Broderick, to serve as real estate agent for the Lewiston home of Snyder’s late mother. Snyder presented evidence suggesting the Brodericks worked together on several other estate cases in violation of state rules barring public administrators from “self-dealing” and doing business with relatives.
Broderick and his attorney, George Muscato, consistently maintained that no wrongdoing occurred, saying the state regulations in question were never formally adopted and, therefore, could not be enforced.
The legal dispute with Snyder ended in a settlement brokered by Judge Matthew J. Murphy III. As part of the settlement, Broderick agreed to step aside as administrator of the Snyder estate and all parties involved were barred from publicly discussing any details of the case.
DiNapoli released the audit’s results at a 10 a.m. press conference today at Niagara Falls City Hall.
Here are some of the report's highlights:
- The comptroller’s office reviewed the Administrator’s processes for the identification, documentation, collection, safeguarding and liquidation of estate assets, cash management, recordkeeping, and the selection of service providers for 15 estates with gross assets totaling approximately $1.8 million. For administering these estates, the Administrator will receive commissions totaling approximately $73,000. We question whether the Administrator has consistently acted in the best interest of the estates and adequately fulfilled his responsibilities.
- The Administrator has not established proper procedures or controls to adequately safeguard estate assets or to protect the interests of the estates’ creditors and beneficiaries. Specifically, he did not ensure that all decedent assets are identified, documented, collected, safeguarded, appraised, liquidated and properly credited to the estate. For example, he did not control the identification, documentation, collection, and sale of assets found during the search of decedents’ premises. He did not maintain adequate inventory records and there was minimal photographic or video evidence documenting the existence and condition of assets that were found and subsequently liquidated.
- Found that typically the Administrator failed to have assets professionally appraised or document how he determined the value of the assets that were sold. In addition, we found that the Administrator may have received less than fair value for certain assets that he liquidated. For example, the Administrator sold three vehicles to a County employee (Sheriff Deputy) for a total of $2,000. One of the three vehicles sold included a 1970 Chevrolet Monte Carlo which may have had substantial value to a classic car collector and/or enthusiast as we found seven listings for 1970 Monte Carlos with asking prices ranging from as low as $9,850 to as high as $38,000. The Administrator did not use a competitive selection process for individuals he retained to perform certain of his duties, such as attorneys, real estate agents and appraisers. Moreover, because he did not use a competitive selection process and family and acquaintances of the Administrator benefited from estate activities, we question whether the Administrator has consistently acted in the best interest of the estate when retaining these individuals. He did not maintain adequate supporting documentation for certain estate expenditures and/or disbursements to individuals, especially attorneys.
- Found that a Treasurer’s Office employee spends a signifi cant amount of County-compensated time performing estate-related work for which the Administrator (Treasurer) is compensated by commissions from the estates. As such, it is unclear the extent to which the Administrator himself is fulfilling many of his fi duciary duties for which he receives a commission.
- The report has been referred to the Niagara County District Attorney for his consideration.
To view the full report, go to: www.osc.state.ny.us/localgov/audits/counties/2010/niagarapublicadmin.pdf
