State Inspector General issues report about investigation of dual enrollment and fiscal issues at NETC

The South Carolina Office of the Inspector General’s Office issued a report Friday detailing an investigation into Northeastern Technical College’s dual enrollment and fiscal issues.
In the report, Inspector General Brian Lamkin wrote the SIG Office’s investigation was initiated from a confidential complaint that alleged NETC senior officials purposefully enrolled high school students in the college’s Dual Enrollment Program without their knowledge or consent, nor permission of their parent or guardian.
The investigation started around Dec. 5, 2023, into the alleged financial mismanagement and wrongdoing within the Dual Enrollment Program, as well as any associated wrongdoing found during the investigation.
The SIG did not identify criminal activity in the materials reviewed, the report said.
“However, the fraud risk level is assessed at the moderate to moderately-high level due to significant deficiencies and material weaknesses in its fiscal practices and lack of internal controls in its governance,” wrote Lamkin.
The review period covered fiscal year 2017-18 through FY 2022-23.
The scope was expanded to include misuse of grant funds through FY 2023-24 based on additional information received by confidential, credible and corroborated complainants.
The findings and recommendations are in various areas.
Dual Enrollment Program
The Dual Enrollment Program had seven findings and recommendations.
In finding one, the SIG determined that NETC’s dual enrollment procedure was outdated. The procedure was last reviewed Feb. 28, 2013. The recommendation was NETC should review its dual enrollment procedures and make periodic updates as needed.
In finding two, the SIG determined NETC failed to adhere to policies and procedures governing the Dual Enrollment Program’s eligibility criteria. The recommendation was NETC should develop practices that adhere to applicable policies and procedures that govern the Dual Enrollment Program to ensure it follows eligibility criteria.
In finding three, the SIG determined that NETC enrolled students into the Dual Enrollment Program from the Marlboro County School District without an executed memorandum of agreement. This finding is mitigated by NETC’s obtainment of an executed MOA with MCSD during this investigation. No further action is required. The recommendation is NETC should ensure it has compliant written agreements with the local school districts who participate in the Dual Enrollment Program.
In finding four, the SIG observed NETC staff working directly with the Dual Enrollment Program were unaware of the policies and procedures governing the program. The recommendation was that NETC should ensure proper training and onboarding regarding policies and procedures within the Dual Enrollment Program for newly hired employees and periodic training for current employees.
In finding five, the SIG observed that NETC failed to maintain proper records for eligibility and admission requirements for the Dual Enrollment Program. The recommendation is NETC should develop policies and procedures for compliant retainment of student records and forms for the Dual Enrollment Program.
In finding six, the SIG determined that NETC implemented a Fast Track Advising Program process without formalized policies or procedures. The recommendation was that NETC should immediately cease their Fast Track Advising Program, autoenrollment process, and enrollment of students without their knowledge until it corrects the deficiencies in enrollment practices and formulates attainable policies and procedures to outline this process.
In finding seven, the SIG determined that NETC’s failed enrollment process resulted in unreconciled balances in student financial accounts. The recommendation was NETC should conduct a thorough examination and reconciliation of each student’s financial account.
Fiscal issues
Fiscal affairs had five findings and recommendations.
In finding one, the SIG determined that NETC lacked supporting documentation for 38 payments in the amount of $183,431.43. In addition, NETC did not follow its own internal policies on promotional activities and accounts payable in the amount of $208,590.65. The recommendation is that NETC should develop and implement proper record-keeping policies.
In finding two, the SIG observed that NETC lacked sufficient travel documentation for expenses for three payments in the amount of $20,980.49. The recommendation is NETC should implement compliant record-keeping policies for travel expenses.
In finding three, NETC failed to provide the SIG with the Predominantly Black Insitutions grant budget following multiple requests. The recommendation is NETC should develop policies and procedures to ensure the maintenance of grant documentation in accordance with regulation §12-804.17.
In finding four, SIG determined that NETC mismanaged, misused, and made unallowable payments at least 16 times that totaled at least $48,116.88. The recommendation is NETC should establish a centralized grant system to properly manage expenditures and develop appropriate internal controls to prevent mismanagement and misuse of taxpayer funds.
In finding five, SIG observed that two payments totaling $91,850 were made directly to the NETC Foundation without approvals from the director of finance. The recommendation is the NETC’s director of finance should review and approve all payments made to the Foundation and develop proper internal control measures to prevent unapproved payments.
In summary, Lamkin wrote his office respects and encourages maximization of dual enrollment for qualifying SC students, unfortunately NETC’s fast track enrollment initiative appeared to have been rushed and not fully vetted, including not having the appropriate administrative systems in place to prevent errors.
“NETC failed one or more invisible students, transforming them, via a flawed fast track scheme, into ghost students – haunting the reliability of NETC’s enrollment numbers,” wrote Lamkin. “Inflated enrollment numbers provided additional funding to NETC which served select faculty and staff justifying salary increases and/or bonuses. Due to the inadequacies of NETC staff, some students were left with grade discrepancies, issues with financial aid eligibility at future institutions, and unreconciled student account balances.”
Lamkin noted the fiscal affairs issues discussed throughout the report can mostly be summed up under the guise of lack of training, and lack of qualified staff – including both having appropriate internal policies as well as implementing these policies.
NETC officials explained to the SIG that they are not ignorant of these issues and that the struggle is hiring and retaining qualified staff – who live in the local area or are willing to relocate – at the available salary levels. The failure to follow fiscal policies and regulations designed to protect the college against inaccurate accounting and reporting resulted in substantial examples of internal control, and governance and oversight deficiencies and weaknesses.
The SIG identified $461,119.45 “that represent significant deficiencies and material weaknesses in the NETC’s failure to govern and provide fiscal oversight of its state and federal funds.”
-Lacked Support Documentation-non travel – $183,431.43

-Lacked Travel Support Documentation – $20,980.49 -No Purchase Order – $ 198,440.65
-Mismanagement of Grant Funds – $31,397.46 -Unallowable Expenditures $ 15,931.54
-Promotional Activities Policy Violation – $10,150
-Reimbursement over GSA Rate $787.88
Total $461,119.45
The recommendation of the SIG is, “NETC should consider organizing with the appropriate state agencies and develop an approach towards a robust shared services model. NETC and the other technical colleges can work together with the SC Technical College System, the SC Department of Administration, and the South Carolina 21 Department of Education to explore options for these overhead administrative type functions, e.g. procurement, HR, payroll, finance, grant management, audit compliance, IT, bookkeeping, etc.”
The report is available at https://oig.sc.gov/sites/oig/files/Documents/Reports/2024/NETC_Report_4.pdf