Audit scrutinizes P.I. loan programs
The preliminary results of a forensic audit into the Port Isabel Economic Development Corp. revolving loan programs found poor record-keeping by officials and scrutinized the consultant overseeing the project.
Billy Bradford Jr., of accounting firm Hales-Bradford, told city commissioners Tuesday he and his staff were alarmed at the lack of city records on loan program funds. Commissioners met in executive session to discuss potential legal action against the parties involved.
The U.S. Department of Agriculture awarded the Port Isabel EDC funds for two revolving loan programs to spur small business growth. As borrowers made loan payments that were collected by consultant Petra Reyna, the funds were then transferred to the EDC and awarded to new applicants.
Bradford said records show Reyna was hired as a consultant and administrator on the project in March 2009.
One award was the Rural Enterprise Business Grant, which included $300,000 from the USDA and a $105,000 match from the Port Isabel EDC in 2009. The other was the Intermediary Relending Program, which included a $400,000 USDA loan and $112,500 match from the Port Isabel EDC in 2011.
Bradford said he could not find records of any loan payments from borrowers deposited to the EDC prior to August 2013, though borrowers provided evidence to his staff that they made payments.
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