Report: Mysterious $1.8B surplus reported in SC coffers doesn’t exist

COLUMBIA, S.C. (WCSC) – The state of South Carolina now faces a U.S. Securities and Exchange Commission investigation into the misreporting of a $1.8 billion surplus that never existed, lawmakers have confirmed.

Gov. Henry McMaster released a statement late Wednesday after a forensic accounting report that found the reported surplus never actually existed.

“This comprehensive forensic accounting report confirms that there is no $1.8 billion surplus. There is no missing or stolen money. The funds do not exist,” McMaster said in a statement.

The independent report, released Wednesday by AlixPartners, cited “unintended accounting mistakes made by different parties involved in state government’s transition from an old accounting system to the new accounting system,” the governor said.

“I am confident that the corrective measures recommended in the report will be embraced by the parties and the General Assembly so that this does not happen again,” McMaster said.

State Treasurer Curtis Loftis also released a statement on the report:

We thank Alix Partners for their efforts, which have validated what we’ve known all along – there is no mystery bank account with $1.8 Billion in it, no missing money, and all cash and investments are accounted for.The citizens of South Carolina can be confident that their money is safe. We, along with our state partners, look forward to reviewing the report in its entirety.

Click here to read the full audit.

The price tag for the report from the Washington, DC-based financial advisory and consulting firm, was estimated to be as high as $3 million.

This is a developing story. Check back for updates.

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